> ## Documentation Index
> Fetch the complete documentation index at: https://docs.sundialprotocol.com/llms.txt
> Use this file to discover all available pages before exploring further.

# Solstice: pooled BTC vaults with a receipt token

> Solstice pools deposits in one BTC vault per Yield Provider and issues a fixed-supply receipt token that redeems at the vault's rising Claim Ratio.

Solstice is the pooled rail. It connects Bitcoin to traditional, off-chain finance: each Yield Provider has one BTC vault that issues its own receipt token (RT). You invest BTC and receive RT. You redeem RT for BTC at the vault's current **Claim Ratio**, which rises as the deployed BTC earns.

> [!NOTE]
>
> Solstice is in development. See [Status and security](https://docs.sundialprotocol.com/overview/status.md).

## How it differs from Dawn

| | Dawn | Solstice |
| - | - | - |
| Structure | One escrow per deposit | One vault per provider |
| What you hold | A timelocked position | A receipt token |
| Yield | A fixed return paid by the deadline | A rising redemption value |
| Exit | After the deadline | Redeem from a liquidity buffer, or join a queue |

Both keep the BTC on Bitcoin and both are built on the `btc-locker` primitives.

## The Claim Ratio

$$
\text{Claim Ratio} = \frac{BTC_{yp} + BTC_{buffer}}{RT_{total} - RT_{vault}}
$$

* **BTC<sub>yp</sub>** is the provider's position, valued according to the provider's profile.
* **BTC<sub>buffer</sub>** is liquid BTC held for instant redemptions. The target is about 5% of the vault's value, with a hard floor and a per-cycle cap. The provider refills it.
* **RT supply is fixed.** The whole supply is created once and held by the vault. Issuance is the amount of RT that has left the vault. Nothing is minted or burned afterwards.

## Investing and redeeming

* **Invest.** BTC in, RT out, priced at a signed, short-lived ratio quote. If the quote expires, you request a new one. A stale price is never settled.
* **Redeem.** RT in, BTC out. An instant redemption is offered only when the buffer has the headroom to honour it. Otherwise the redemption joins a queue.
* **Queue.** First in, first served, settled at the next buffer refill.

Each swap is a single Bitcoin transaction in which BTC and RT move together. You sign it, and the server co-signs and submits it.

## The receipt token

By default the receipt token is a **Rune** on Bitcoin. It is etched once with the entire supply held by the vault and no open minting. Investing and redeeming move RT with Runes transfers.

A variant that issues the receipt as a native asset on Cardano, while the BTC stays on Bitcoin, is in draft.

## Connecting Bitcoin to off-chain finance

Solstice connects a pool of Bitcoin to a Yield Provider's off-chain strategy. The provider is a traditional finance institution that deploys the vault's BTC and reports its position, and that position is what moves the Claim Ratio.

Every invest and redeem settles atomically on Bitcoin at a signed, current ratio, so you always trade at the vault's up-to-date value.


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