NAV-Bound Stability

While the Fission DEX employs an automated market maker (AMM) algorithm, that AMM is not the sole determinant of price movement. The AMM can only facilitate trades within the price range of the liquidity provided, which allows the TECH Vault to concentrate the price of TECH with the bounds of its liquidity provisioning.

To inform those price bounds, the Fission Protocol uses an off-chain data provider to aggregate third-party information - broker transactions, 409a valuations, and marks from other funds holding these assets - to create a daily price for each asset. This price is called the Net Asset Value (NAV) and represents a best estimated per-share value of the basket of assets held in TECH. The TECH Vault anchors its liquidity range around this NAV. This approach creates price consistency and stability, tying the asset prices to their institutional investor valuations.

The combination of stackable returns and real-world anchored price is the key to the TECH Vault's attractiveness as an investment vehicle. By providing exposure to a diversified portfolio of private market assets, offering multiple sources of returns, and maintaining price stability through NAV-based trading ranges, TVLT presents a compelling opportunity for investors who want to reap the rewards of the growth of innovative companies without the extreme volatility often associated with crypto assets.

By incentivizing deposits to the Vaults, which set their liquidity providing ranges for their respective token according to its NAV, this structure encourages the concentration of liquidity around that NAV, thereby reinforcing the stability of the RWA token (TECH) price and minimizing deviations from fundamental value.