The Treasury Wallet is another key feature of TIDAL Protocol that will collect cover token issuance, transaction and redemption fees, and a percentage of income from deploying the reserves (held in mutual cover pools) in external DeFi protocols.
All collected fees and any additional yield will be held in Treasury Wallet and used as a back-up, source of reserve capital, if the Guarantor’s capital and reserve capital for a specific mutual cover pool has been exhausted, and it’s no longer enough to cover the total amount liable to the cover token holders.
The disbursement of the funds held in the Treasure Wallet for covered mutual claims will be determined by vote of holders of the TIDAL token.
If reserves held in a specific pool and reserves held in Treasury Wallet are still not enough to cover all the claims, the deficit can be covered by issuing TIDAL tokens. However, a strong majority of TIDAL tokens holders will have to approve of any such action.
Treasury Wallet will be seeded by an initial deposit of funds generated through the sale of TIDAL tokens.