Net Withdrawal Flow

The net withdrawal flow occurs when a deposit intent and a withdrawal intent are resolved together, with the withdrawal amount being larger than the deposit amount. By netting the two, the protocol significantly reduces the bridge loan required — lowering exit costs for withdrawers.

Lifecycle

sequenceDiagram
    participant D as Depositors
    participant W as Withdrawers
    participant FD as Deposit Intent
    participant FW as Withdrawal Intent
    participant Req as Request
    participant PM as Position Manager
    participant Fund as Fund

    D->>FD: 1a. Deposit USDC
    FD-->>D: ERC-6909 LP tokens
    W->>FW: 1b. Deposit PM shares
    FW-->>W: ERC-6909 LP tokens

    Note over FD,FW: 2. Facilitator locks both intents

    FW->>Req: 3. Pull bridge loan (net amount)
    Req-->>FW: Bridge capital (USDC)

    FW->>PM: 4. Repay debt & withdraw collateral (net amount)
    PM-->>FW: Burn PM shares, release collateral

    FW->>Fund: 5. Redeem collateral
    Note over Fund: 6. Redemption wait
    Fund-->>FW: 7. USDC proceeds

    FW->>Req: 8. Repay bridge loan

    FW->>FD: 9. Swap PM shares for USDC
    FD->>FW: USDC

    Note over FD,FW: 10. Both intents resolved
    D->>FD: Claim PM shares
    W->>FW: Claim USDC

How It Works

Instead of processing the deposit and withdrawal independently, the protocol nets them:

1. Deposit phase — Users deposit capital (e.g., USDC) into the deposit intent. Separately, withdrawers deposit PM shares into the withdrawal intent
2. Lock — The facilitator locks both intents and begins resolution
3. Bridge loan — The Facility pulls bridge capital from a Request. The borrowed amount is based on the net difference (withdrawals minus deposits) rather than the full withdrawal amount, multiplied by leverage minus 1
4. Position unwinding — The Facility uses the bridge capital to repay debt on the Position Manager and withdraws the freed collateral corresponding to the net withdrawal. PM shares are burned
5. Fund redemption — The Facility submits the withdrawn collateral to the Fund wrapper for redemption
6. Redemption wait — The external protocol processes the redemption
7. Unlock — The Fund wrapper returns USDC proceeds
8. Repayment — The USDC proceeds repay the bridge loan via the Request
9. Swap — After repayment, the withdrawal intent holds leftover PM shares equivalent in value to the USDC held by the deposit intent. The two intents swap: PM shares go to the deposit intent, USDC goes to the withdrawal intent
10. Resolution — Both intents are resolved. Deposit LP holders claim PM shares, withdrawal LP holders claim USDC

Bridge Loan Sizing

The bridge loan is not fixed at (withdrawal − deposit) × (n − 1). That value is the minimum needed to cover the net leverage unwinding, but the actual amount also accounts for retargeting the existing Position Manager:

• Below target LTV — the existing PM is under-leveraged, so less bridge capital is needed. The withdrawal itself helps bring the LTV up
• Above target LTV — the existing PM is over-leveraged, so more can be borrowed to bring it closer to target

The bridge loan is always capped at (n − 1) × withdrawal, the same as a standalone withdrawal flow. The protocol nets three intents together: the withdrawer exiting, the depositor going from 1x to nx, and the existing PM holders retargeting back to nx.

Fee Sharing

The bridge facilitator fees (the cost of the bridge loan) are shared proportionally among depositors and withdrawers. Both sides benefit from the reduced loan size — depositors because the bridge loan is smaller than a standalone deposit would require, and withdrawers because they are not bearing the full cost alone.