Frequently asked questions
Basics
What is HoodStash?
HoodStash is a covered-call vault for tokenized stocks.
Depositors supply stock tokens. The vault sells option claims in a public weekly auction. Winning bidders pay premium in a dollar token.
Premium can add income. The option can also cap the depositor's gain above the strike.
Who chooses the stock price, strike, and premium?
The price comes from the configured on-chain feed.
The contract computes the strike from:
- the opening price;
- a deterministic volatility report; and
- governance rails that limit the result.
The public auction discovers the premium. No role can choose an unrestricted weekly strike or clearing price.
Why does every winner pay the same price?
The auction orders bids from the highest maximum premium to the lowest. It fills the offered amount and sets the lowest accepted premium as the clearing price.
Every winner pays that clearing price, even when its maximum was higher.
The final contract result is authoritative. A pre-close estimate can change.
Weekly lifecycle
What happens during one weekly round?
- The vault collects pending deposit and withdrawal requests.
- The keeper opens an auction when the price is usable.
- Bidders escrow dollar tokens.
- The auction closes at one clearing price.
- Premium moves to the vault.
- The option remains active until expiry.
- The first eligible price after expiry sets the result.
- Above-strike claims can exercise during their window.
- The vault processes withdrawals when obligations permit it.
The contract uses configured timestamps. A market holiday can change the last trading day.
When does the premium reach the vault?
The auction transfers premium when it clears.
The vault credits the distributable premium through its weekly accounting after the protocol fee. The outcome at expiry does not make a bidder pay later.
Can a depositor leave during an active option?
A holder can request a withdrawal. The shares move into escrow.
The vault processes that request after the active option obligation allows it. This prevents a depositor from removing stock that backs a sold claim.
An unlocked withdrawal request can be cancelled. A processed withdrawal becomes a pull-based claim.
Can a queued deposit be cancelled?
Yes. The contract permits cancellation before activation.
The current app does not show this control yet.
Claim tickets
What does a winning bidder receive?
A winning allocation can mint a transferable claim ticket.
The ticket gives its current holder the right to buy a stated stock amount at the strike before the exercise deadline.
Is a claim ticket tied to the original bidder?
No. The current holder owns the exercise right.
Moving a ticket moves the right. A past bid record does not prove current ownership.
Can a claim exercise in parts?
Yes. A holder chooses an amount up to its balance.
The contract burns that amount, pulls the exact strike payment, and sends the matching stock in one transaction.
What happens to unused bid money?
It becomes a pull-based refund.
A refund can include:
- the difference between the bid maximum and clearing price;
- an unfilled amount;
- a losing bid;
- a cancelled auction; or
- a skipped auction.
The owner must claim the refund.
What happens when a claim is not exercised?
It lapses after the exercise window. The remaining stock stays in the vault. The premium stays with the vault.
Price safety
Why can the displayed price remain unchanged?
A price feed publishes according to its own update rules. An unchanged round is not automatically stale.
The protocol compares the update time with the configured heartbeat.
What happens when the price is stale?
Price-dependent actions reject or wait.
Settlement waits for an eligible round. It does not use an old answer.
What happens during a corporate action?
The stock token can report that its price is paused.
While that flag is true, the protocol does not trust the price. It waits for the flag to clear and for a fresh price.
What happens when the network sequencer is down?
The protocol treats the price as unusable.
After the sequencer returns, the protocol waits through the configured recovery period before using the price.
Fees and risk
What is the protocol fee?
The fee is 12% of collected premium.
The fee comes from premium only. It never comes directly from deposited stock. No premium means no premium fee.
Does the first-loss reserve guarantee deposits?
No.
The reserve holds a limited dollar-token balance. It pays only defined settlement shortfalls. One event is capped by the contract.
It does not cover normal stock losses, capped gains, every software defect, or every outside-system failure.
What can a depositor lose?
A depositor can lose value when the stock falls.
A depositor can also miss gains above the strike when claim holders exercise. Premium may not offset either cost.
Read what the strategy can cost.
Is premium guaranteed each week?
No.
A thin auction can clear low, sell only part of the offered amount, or skip. A cancelled auction produces no sale.
Trust
Can an administrator take vault funds?
No administrative function transfers user principal to an administrator.
Pause controls can delay actions. They do not create a withdrawal right for the guardian or governance.
Which data should a user trust for money?
Use direct contract reads for:
- current balances;
- claims;
- phase;
- price usability; and
- transaction simulation.
Use indexed data for history and analytics only.
Are the contracts risk-free?
No.
Immutable code, tests, limits, and public state reduce some risks. They do not remove contract, network, token issuer, price-feed, auction, wallet, or market risk.
Read the technical trust model.