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Restructured from flat .tex/.pdf files into per-paper subdirectories. Added Antje Worring as co-author on all papers. Synced PDFs to pdfs/ for download site.
55 lines
2.1 KiB
TeX
55 lines
2.1 KiB
TeX
\section{Solvency State Machine}
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\label{sec:state-machine}
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The protocol defines exactly four solvency states. All transitions are deterministic given $B$ and $L$. No transition requires operator discretion.
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\subsection{States}
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\begin{definition}[Healthy]
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$B \geq L / \lambda$ and $B \geq L$. All operations permitted.
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\end{definition}
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\begin{definition}[Restricted Mint]
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$B < L / \lambda$ but $B \geq L$. Equity buffer depleted; principal still covered. Mint \textbf{disabled}. Burn and release allowed. Strategy deployment halted; withdrawals initiated.
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\end{definition}
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\begin{definition}[Emergency]
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$B < L$. System undercollateralized on principal basis. Mint \textbf{disabled}. Burn allowed. Release governed by emergency policy. Strategy withdrawals \textbf{forced}. Recovery governance \textbf{active}.
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\end{definition}
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\begin{definition}[Recovery]
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Post-emergency transitional state. Mint disabled until $E/B \geq 1 - \lambda$. Burn and release allowed. Exit requires governance or MPC quorum.
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\end{definition}
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\subsection{Transition Diagram}
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\begin{center}
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\begin{tikzpicture}[
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->,>=stealth,shorten >=1pt,
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state/.style={rectangle, draw, rounded corners=4pt, minimum width=2.4cm,
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minimum height=0.9cm, font=\small\bfseries, inner sep=4pt},
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every edge/.style={draw, font=\scriptsize},
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node distance=2.8cm and 3.8cm
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]
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\node[state] (H) {HEALTHY};
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\node[state, right=of H] (R) {RESTRICTED};
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\node[state, below=of R] (E) {EMERGENCY};
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\node[state, below=of H] (V) {RECOVERY};
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\path (H) edge[bend left=15] node[above] {$B < L/\lambda$} (R);
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\path (R) edge[bend left=15] node[below] {$B \geq L/\lambda$} (H);
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\path (R) edge node[right] {$B < L$} (E);
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\path (E) edge node[below] {recapitalization} (V);
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\path (V) edge node[left] {$E/B \geq 1{-}\lambda$} (H);
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\path (H) edge[bend right=40, dashed] node[left,align=center]
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{\footnotesize auto-pause\\$B < 0.985L$} (E);
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\end{tikzpicture}
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\end{center}
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\subsection{Auto-Pause Trigger}
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An accelerated emergency trigger fires when $B < \alpha \cdot L$ with $\alpha = 0.985$. This immediately halts all outbound operations except burns.
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