EPT Pricing

EPT price depends on one equation. This page walks through that equation and what drives it.

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The Minting Parity Equation

Every EPT pricing analysis starts from the deposit contract: $1 \text{ USDC deposited} = \frac{1}{R} \text{ ST} + 1 \text{ EPT}$ where $R$ = NAV per share. Depositing 1 USDC always mints exactly $1/R$ ST shares and exactly 1 EPT. No exceptions. Since the two tokens are co-minted, their prices are linked. If ST trades at price $X$ on the ST/USDC orderbook, the fair value of EPT is: $\text{EPT}_{\text{fair}} = 1 - \frac{X}{R}$ Intuition: a $1 deposit creates ST worth $X/R$ and 1 EPT. The EPT accounts for whatever value the ST does not. If ST trades at $0.92 with NAV at 1.00, then EPT fair value is $0.08. This isn’t just a formula — cross-matching enforces it. Whenever an EPT buy and an ST buy appear at prices that sum to $1 or more, the engine mints new tokens and fills both orders. That keeps the combined price from ever drifting above the minting cost.

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Returns Framing

The natural question when looking at EPT prices is “is $0.08 too expensive?” The better question is: what is the implied return? EPT is a claim on future points. Its value depends on how many points you earn and what those points are worth at TGE. Instead of evaluating the absolute price, trace the full return.

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Worked Example

You buy 100 EPT at $0.05 each ($5 total) during an 8-week epoch. Here’s how the return plays out: That’s the implied return. It replaces guessing about time decay with one question: what return am I getting on my EPT investment? Now compare: if EPT is priced at $0.05 with 8 weeks left, you earn credits for all 8 weeks. If EPT is still $0.05 with only 2 weeks left, you earn credits for just 2 weeks. Same price, but 8 weeks gives you far more credits and therefore more points. The returns framing makes this obvious: $0.05 with 8 weeks left is a better deal than $0.05 with 2 weeks left. In practice, EPT price decays as the epoch progresses precisely because fewer credits remain. At 2 weeks left, the market prices EPT lower to reflect the reduced earning window.

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Why EPT Price Falls Over the Epoch

EPT accrues credits while you hold it. As the epoch progresses, fewer credits remain to be earned. An EPT purchased at Week 1 accrues credits for 7 more weeks. An EPT purchased at Week 6 accrues credits for 2 weeks. The market prices this in: EPT gets cheaper as the epoch advances, because each token has less earning potential left. This is not mechanical decay imposed by a curve. It is the market correctly pricing a shrinking stream of future credits.

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Leverage Is Not a Fixed Number

When you buy EPT at $0.05 instead of minting at $1.00, you get 20x more EPT per dollar. But that “20x” means very different things depending on when you buy it. Early in the epoch, those 20x EPT accrue credits for weeks. Late in the epoch, the same 20x EPT accrue credits for days. The leverage ratio is the same, but the implied return (APR) is vastly different. This is why the UI shows both APR and leverage side by side. Changing one auto-updates the other. You can think in whichever frame is more intuitive, but APR captures the time dimension that a raw leverage number does not. Limit orders are placed in APR terms — the price adjusts automatically based on time remaining.

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Orderbook Price Dynamics

EPT trades on the EPT/USDC orderbook. Price discovery happens through standard limit orders. Buyers and sellers post bids and asks, and the matching engine executes trades.

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Secondary Trading

When an EPT holder sells to an EPT buyer, USDC changes hands. No minting or burning occurs. The seller keeps all credits earned up to the moment of sale. The buyer begins accruing from zero.

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Cross-Matching

The EPT/USDC and ST/USDC orderbooks are connected through the minting parity. When a buy order on the EPT book and a buy order on the ST book have prices that satisfy: $P_{\text{EPT}} + \frac{P_{\text{ST}}}{R} \geq 1$ the matching engine can cross-match them. The protocol takes the combined USDC, deposits it into the vault, and delivers EPT to one buyer and ST to the other. This creates a price ceiling: the sum of buy-side prices across both books cannot persistently exceed the minting cost, because cross-matching mints new supply until the gap closes.

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UI View: APR-Based Orders

In the UI, users do not set raw token prices for these limit orders. They set APR constraints:

• ST buyers set the minimum APR they require.
• EPT buyers set the maximum APR they are willing to give up.

The engine translates those APR limits into executable prices based on time remaining in the epoch. We use APR because it is time-invariant for user intent: “I need at least X%” or “I can pay up to Y%.” If limits were placed as raw prices, users would need to keep updating orders as time passes, because the same price implies a different APR later in the epoch.

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One-Way Arbitrage

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Upward Arb Works

If EPT + ST buy prices exceed the minting cost, cross-matching creates new tokens and pushes prices back in line. This is a hard ceiling enforced by the protocol. Example: EPT bids at $0.12, ST bids at $0.94 (sum = $1.06 with R = 1.0). The engine mints, delivers tokens, and new supply pushes prices down to parity.

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No Downward Arb (Yet)

If the combined prices fall below minting cost, the correcting trade would require buying both tokens and burning them for USDC. There is no early redemption mechanism today, so this arbitrage path does not exist. The ST discount can therefore persist wider than fair value. Yield seekers buying cheap ST provide a natural floor, but there is no guaranteed mechanical correction on the downside. Early redemption is on the roadmap for a future version.

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What Drives EPT Price

ST price and EPT value are linked through minting parity. Cross-matching enforces a ceiling: if buy-side prices sum above $1, the engine mints new supply.

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What Drives the ST Discount

The ST discount is the other side of EPT pricing. The two are mechanically linked.

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Factors That Widen the Discount

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Factors That Narrow the Discount

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Equilibrium

The discount settles where two forces balance: $\text{EPT buying pressure (drives mints, creates ST supply)} = \text{Yield seeker buying pressure (absorbs ST supply)}$ Points farmers want cheap EPT, which requires a wide ST discount. Yield seekers want cheap ST, which the wide discount provides. The market-clearing price is where the marginal points farmer’s willingness to pay for EPT meets the marginal yield seeker’s willingness to hold ST risk.

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Worked Example ($100)

Setup: NAV = 1.00, ST trading at $0.92 (8% discount to NAV).

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Fair EPT Price

$\text{EPT}_{\text{fair}} = 1 - \frac{0.92}{1.00} = \$0.08$

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Points Farmer: Buying EPT on the Orderbook

A points farmer places a buy order at $0.08 per EPT. $\frac{\$100}{\$0.08} = 1{,}250\text{ EPT}$ Compare this to a direct deposit: $100 into the vault mints 100 ST and 100 EPT. Buying on the orderbook yields 12.5x more EPT for the same capital at this price. The leverage comes entirely from the price — no looping, no compounding. But remember: leverage is not a fixed number. The same 12.5x means different APR depending on time remaining.

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Yield Seeker: Buying ST on the Orderbook

A yield seeker buys ST at $0.92. If the strategy earns 1% over the epoch (final NAV = 1.01): $\text{Return} = \frac{1.01 - 0.92}{0.92} \approx 9.8\%\text{ per epoch}$ The 8% discount provides a buffer against strategy losses. The strategy can lose up to 8% of NAV before the ST buyer goes underwater.

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Where the Value Goes

The same $100 buys radically different exposure depending on which token you choose. We do not create value. We separate it. The points farmer concentrates into points. The yield seeker concentrates into USDC returns. The direct depositor gets the unseparated bundle. For the full treatment of credit mathematics and how credits translate to points at maturity, see Credit Mathematics.