Strategic Reserve
The Strategic Reserve is a protocol-owned capital pool designed to create a self-sustaining revenue floor for Orvex, independent of emissions or trading volume.
What funds the reserve
The Strategic Reserve is funded through two sources:
- 80% of oORVX exercise revenue -- when users exercise
oORVXinto liquidORVX, they pay stablecoins at the protocol strike price. 80% of those stablecoins flow directly into the reserve. - Vault performance fees -- a share of fees generated by the Autovote Vaults is also directed to the reserve.
Together, these create a steady inflow of stable-denominated capital into the reserve over time.
Principal is never spent
The reserve operates under a strict constraint: principal is never spent.
Funds entering the reserve are deployed only into principal-preserving strategies such as:
- Stablecoin lending
- Low-risk yield opportunities
The reserve does not take directional risk or speculate. The goal is to protect the base capital while generating sustainable yield.
Reserve yield distribution
Yield generated from the reserve's deployed capital is distributed to veORVX voters as an additional revenue stream. This means veORVX holders benefit from reserve growth over time, on top of trading fees and bribes.
Why it matters
Most ve(3,3) protocols depend entirely on emissions and trading volume for revenue. If volume drops or emissions decline, voter rewards shrink.
The Strategic Reserve addresses this by building a permanent, protocol-owned capital base that generates yield regardless of market conditions. Over time, as the reserve grows, its yield becomes a meaningful and reliable component of voter rewards -- creating long-term sustainability for the protocol.