A shield, priced by the odds.
Everything that happens between buying a Scutum and getting paid: the policy, the price, the pool on the other side, the oracle that settles it and the rules that keep it solvent.
Five moments, zero paperwork.
| Moment | What happens | Who acts |
|---|---|---|
| 1 · Quote | You pick a stock token, position size, floor (−5% to −30%) and term. The contract quotes a premium from the stock's volatility, your floor, the term and the pool's load. | You |
| 2 · Buy | You pay the premium in USDC. A Scutum is minted to your wallet with its terms: stock, shares covered, floor, payout cap, expiry. | You |
| 3 · Warm-up | The shield activates after a short delay, so nobody can insure a stock in the middle of a crash. | Contract |
| 4 · Expiry | At the settlement time an oracle price for the stock token is read on-chain. | Oracle |
| 5 · Settle | If the price is under your floor, the difference (up to the cap) is sent from the Legion pool to your wallet by a keeper. Otherwise the premium stays with the pool. | Keeper |
You keep the stock the whole time. A shield is a separate agreement, so you can sell the stock and keep the shield, or the other way round.
Pays the gap, not the whole fall.
A shield pays the distance between your floor and the closing price, for every share covered, up to a cap 25 points below the floor.
payout = min( max(floor − close, 0), floor − cap )
// floor = price × (1 − 10%) cap = floor − 25% × price
The closer the floor, the higher the price.
A shield is a capped put spread. Its fair cost is what the pool expects to pay on average, computed from the stock's volatility. On top come the pool's margin, a load surcharge and the protocol fee.
margin = 25% × fair // the Legion's edge
load = fair × utilization × 12% // rises as the pool fills
fee = 12% × (fair + margin + load) // protocol
discount = −tier% × (margin + load + fee) // $TSTD holders; never touches the fair cost
premium = fair + margin + load + fee + discount
| TSLA · $10,000 · 1 week | Chance it pays | Premium |
|---|---|---|
| Floor −5% | 27.5% | $180 |
| Floor −10% | 10.2% | $49 |
| Floor −15% | 2.4% | $8.60 |
| Floor −20% | 0.3% | $1 min |
| $10,000 · floor −10% · 1 month | Volatility | Premium |
|---|---|---|
| SPY | 16% | $2.34 |
| AAPL | 26% | $37 |
| NVDA | 48% | $242 |
| TSLA | 58% | $363 |
Demo model with reference volatilities. Floors closer than −5% are not sold: they pay so often that the premium approaches the payout, and they invite gaming around the start time.
Two ranks behind every shield.
The pool that pays out is split into two tranches. Losses hit the first-loss tranche before they touch anyone else, and that tranche is paid more for the risk.
First-loss tranche
Funded by $TSTD stakers. Takes payouts first, up to its full size, and earns double weight on the pool's margin. Stakers are the most confident underwriters, so they stand in front.
Senior tranche
Funded by USDC liquidity providers. Pays only after the first-loss tranche is used up, earns the base share of premiums and can withdraw after each settlement window.
| Example week · 100 shields · TSLA $10,000 · floor −10% | Amount |
|---|---|
| Premiums collected | $4,925 |
| Expected payouts (fair cost) | −$3,382 |
| Protocol fee | −$528 |
| Expected pool income (margin + load) | $1,016 |
| Of the fee: bought back and burned / oracles, keepers, development | $317 / $211 |
Expected values. In a calm week the pool keeps nearly every premium; in a crash week it pays more than it collected. The margin is what makes the long run positive, and the safeguards below are what make the bad weeks survivable.
The oracle decides, not a claims desk.
Price source
Decentralized price feeds for stock tokens on Robinhood Chain, read on-chain at the settlement time. Feeds are chosen per stock and listed publicly.
Settlement time
Week and month shields settle at the close of their last trading day. Weekend Shields settle on the first feed update after Monday's open.
Fallbacks
If a feed is stale or deviates from a second source, settlement waits for a valid price instead of paying on a bad one. Anyone can trigger settlement once it is due.
Rules for the worst week.
| Rule | What it does | Why |
|---|---|---|
| Coverage limit | Total cover per stock and per pool is capped against a stress scenario: every covered stock falling 30% at once. | The pool can pay the worst case it has sold. |
| Start delay | Shields activate a few hours after purchase; Weekend Shields stop selling at Friday's close. | No insuring a stock already in free fall. |
| Utilization pricing | The load surcharge grows with the share of the pool already committed. | Crowded trades pay for their own risk. |
| First-loss tranche | $TSTD stakers absorb losses before USDC providers. | Skin in the game sits in front. |
| Capped payouts | A shield pays at most 25% of the price below its floor. | Every policy has a known maximum. |
| Minimum floor | No floors closer than −5%. | Near-certain payouts are not insurance. |
Keep the position, cap the damage.
| Stop-loss order | Testudo shield | |
|---|---|---|
| On a price gap | Sells at the next price, often far below the stop | Pays the gap below your floor, up to the cap |
| Your shares | Sold | Still yours |
| If the price recovers | You are out and miss it | You keep the recovery and the payout |
| Cost | Free, until it fires at the bottom | A known premium up front |
| Weekends | Nothing works while the market is closed | Weekend Shield is made for it |