Introduction

Rava is an open market on the credit risk of on chain lending books. Longs deposit capital and earn the credit spread. Shorts pay a fixed premium up front and are paid the realized loss. Supply and demand set the price. Rava reads the realized loss, settles in code, and holds no position.

Lending is on chain, the loss is not

Lending happens on chain. A default resolves off it. A borrower stops paying, the collateral is worked out, and the loss lands weeks later. Rava reads that realized loss off the chain and prices it in an open market.

How the platform fits together

Top to bottom: the credit, the market that prices it, the middle that reads and settles, and the people who consume the number.

The credit

The loan book

Maple, on chain. Trading firms and funds borrow against collateral, pay a coupon, and can default. That default risk is the credit the market prices. The market does not lend to them.

the loss and the coupon are read off the chain

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The market sets the price

The long side

deposit, earn the premium, take the loss first

deposit, cheaper
pull back, pricier

The pool

MAPLE-L and MAPLE-S clear on the curve. The premium is the price of the risk.

more demand,
pricier

The short side

go short, pay the premium, paid the realized loss

on a loss, capital settles from the long side to the short side

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The neutral middle

Rava

reads the loss, publishes the benchmark, settles in code, never takes a side. The gap between the benchmark and the market price is the signal.

publishes one number, free to read

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Who uses it

Lenders and integrators

read the number, lend at a higher LTV against a position that is shorted on Rava, settle their own contracts on it

The two sides

One funded pool sits between the two sides and is the counterparty to both. Neither side has to find the other.

Go long, hold the long token. You deposit USDC, stand as the first loss capital behind the book, and earn the risk free rate plus what shorts pay. You pay out if a loss lands. The position is fully funded, with no leverage and no liquidation.
Go short, hold the short token. You take a position of notional N at the rate quoted at that moment, and pay a fixed premium up front for a set term. You are paid the realized loss on N if a loss lands during the term.

What Ravariant does

Read. Reads the realized loss on on chain lending straight from the chain by a fixed rule.
Publish. Publishes one reference number per market, the spread the lending pays and the realized loss, computed from public chain data.
Determine. Turns a raw on chain event into a settled fact through a bonded challenge window and an evidence based panel for contested cases.
Settle. On a loss, the fully funded contract moves capital from the long side to the short side, in code.

Rava never deposits and never bears the loss, so it cannot move the price. The market sets the price by supply and demand.

What settles today

A loss settles on real economic loss only: a borrower default, a collateral shortfall, or a liquidation that gaps and recovers less than the loan. A hack or exploit of the protocol's own contracts does not settle.

The markets live today are Maple, Steakhouse, Gauntlet, and Pareto, spanning institutional credit and curated on chain lending. 3Jane is under review. More books are listed as they clear the rulebook. The inclusion rules and the full universe are in the rulebook.

How it settles

Rava reads one realized loss number for a market, by the published rule.
A loss event is proposed with a bond and enters a challenge window.
If challenged, a panel rules against the rulebook, and the loser forfeits the bond.
On a loss, the contract moves USDC from the long side to the short side, in code. Ravariant custodies the collateral and holds no position.

Core concepts

The spread

The reference each market publishes, the spread and the realized loss.

Inclusion and the rulebook

How a loan qualifies, the size floor, the diversification rules, and reconstitution.

Long and short

The two tokens and how a fully funded position works.

Settlement and custody

Fully funded contracts, how the money moves on a loss, and custody.

How a loss is decided

Optimistic publish, the bonded challenge, and the panel that rules on contested events.

Integration

Reading the published number and its envelope. Free to read, licensed to settle.

What Ravariant is not

It makes no loans and holds no position in the contracts it settles.
It does not set the price. The market sets it by supply and demand.
It publishes no forecast. The number is a realized loss and a current spread, read from the chain.
It assigns no letter grades and gives no buy or sell opinion.

Next: Quickstart