04 / 14 · docs
Selling
bring me your stocks. take your cash now.
The advance at night, the settlement at the open, and a worked example with numbers.
simulation Simulation only. The protocol is not live. No transaction is ever sent.
Selling through EVE is a sale in two payments. The first, the advance, arrives at night. The second, the balance, arrives at the next open, once the price is known.
What you can sell, and when#
What. Coinbase tokenized stocks on Base: NVDA, AAPL, META and GOOGL. Version one is sell-side only: EVE buys from you, it does not sell to you.
When. Only while the New York Stock Exchange is closed: weeknights, weekends, market holidays, and the afternoon of an early close. While the market is open there is no reason to use EVE, since the token already trades at a live price. See Market hours.
When not. A ticker can be unavailable on a given night:
- it is blocked because a corporate action is pending;
- it is blocked, or advanced at a lower rate, because the company reports earnings before the next open;
- tonight's volume cap for that ticker has been reached.
These are safeguards, described in Risk and safeguards.
The advance#
take your cash now.
When you deposit, EVE pays you an advance in USDC in the same transaction:
advance = quantity × reference price × advance rate
- Quantity is the number of shares you deposit.
- Reference price is the last fresh Chainlink price, which after the close is the closing price. The feed is frozen at that value all night. See Oracles.
- Advance rate is 90% on a normal night. On an earnings night it is 75%, or the ticker is blocked. Current setting: reduce todo.
The part that is not advanced is the haircut: 10% by default. It is not a fee. It is still yours, and it comes back in the balance if the stock opens where it closed.
While you wait#
Your stocks are with the pool. You hold the advance and a claim on the balance. Two things are worth understanding clearly.
You are selling at the opening price, not at tonight's price. The advance is sized on the close, but the sale is priced at the open. If the stock opens higher than it closed, your balance is larger. If it opens lower, your balance is smaller. You stay exposed to the overnight move on the whole position until the bell, up and down.
There is nothing to manage. No position to watch, no margin, no liquidation. The advance is yours whatever happens.
The settlement#
the bell settles the rest.
At the next market open the pool sells the stocks and the price is fixed:
settlement price = the lower of (oracle average, realized TWAP)
settled value = quantity × settlement price
fee = settled value × nights × fee per night
balance = settled value − fee − advance (never below zero)
- The oracle average is the first fresh Chainlink price after the open, averaged over 5 to 15 minutes.
- The realized TWAP is the average price the pool actually obtains selling the stocks over the first 30 minutes.
- The fee is 0.25% per calendar night: 0.25% for a weeknight, 0.75% for a weekend.
The full reasoning is in Settlement formula.
Balance delivery: not decided todo.
A worked example#
| Step | How | Amount |
|---|---|---|
| Reference value at the close | 10 × $180.00 | $1,800.00 |
| Advance paid at night (90%) | $1,800.00 × 90% | $1,620.00 |
| Oracle average after the open | fresh Chainlink price, averaged | $181.20 |
| Realized TWAP | what the pool got selling | $181.05 |
| Settlement price | the lower of the two (TWAP), +0.58% vs the close | $181.05 |
| Settled value | 10 × $181.05 | $1,810.50 |
| Fee (1 night) | $1,810.50 × 0.25% | −$4.53 |
| Advance already paid | −$1,620.00 | |
| Balance paid at the open | settled value − fee − advance | $185.97 |
| Total received by the seller | advance + balance | $1,805.97 |
Read it from top to bottom. The seller had most of the money on Tuesday evening, and ended up with the Wednesday opening price on all ten shares, less a fee of 0.25%.
If the stock moves a lot#
It opens higher#
You receive the higher price on the whole position. The advance does not cap your sale price.
It opens lower, within the haircut#
The balance shrinks. With a 90% advance and a one-night fee, the haircut absorbs a drop of up to 9.77%. Down to that point the settled value still covers the advance and the fee.
It opens lower than the haircut can absorb#
The settled value no longer covers what you were already paid. In that case:
- your balance is zero;
- you keep the advance (recourse to the seller: none todo);
- the pool's shortfall is covered by the reserve.
| Step | How | Amount |
|---|---|---|
| Reference value at the close | 5 × $700.00 | $3,500.00 |
| Advance paid at night (90%) | $3,500.00 × 90% | $3,150.00 |
| Oracle average after the open | fresh Chainlink price, averaged | $595.00 |
| Realized TWAP | what the pool got selling | $593.60 |
| Settlement price | the lower of the two (TWAP), -15.20% vs the close | $593.60 |
| Settled value | 5 × $593.60 | $2,968.00 |
| Fee (1 night) | $2,968.00 × 0.25%, of which $0.00 can be collected | −$0.00 |
| Advance already paid | −$3,150.00 | |
| Balance paid at the open | never below zero | $0.00 |
| Total received by the seller | advance + balance | $3,150.00 |
| Pool shortfall | advance − realized proceeds ($2,968.00) | $182.00 |
| Covered by the reserve | reserve before: $25,000.00 | $182.00 |
This is the case the haircut, the earnings rule and the volume cap exist to make rare. It is also the main risk depositors carry. See Risk and safeguards.
Limits on a sale#
| Limit | Value | Why |
|---|---|---|
| Nightly volume per ticker | 5% todo of DEX depth | The pool must be able to sell at the open what it bought at night. |
| Earnings nights | 75% advance, or blocked | Earnings gaps are routinely larger than a 10% haircut. |
| Corporate actions | blocked | The Chainlink feed freezes, so there is no trustworthy price to settle on. |
| Pool capacity | not decided todo | The pool can only advance USDC it has. |
Before you sell: a checklist#
- The market is closed and your ticker is not blocked tonight.
- You are comfortable receiving the opening price, whatever it is, on the whole position.
- You have checked the fee for tonight's stretch: weeknight, weekend or holiday.
- You are eligible: tokenized stocks are not available to US persons.
Try it with pretend money first: open the simulator.