How HORIZON works
A covered-liquidity protocol. One solvent pool per asset underwrites both sides of every trade — leverage with no debt, no oracle dependency, and no liquidations.
00Overview
Every market is a row in one hookless singleton; a provider's stake is an ERC-6909 share (token id = market id) — the pool, the position, and the price in one. Providers deposit the risk asset and pick a coverage; holders earn a premium and redeem in-kind.
Traders don't borrow — they rent the pool's own upside (a long) or sell into its floor (a short). In both cases the most they can lose is what they paid, and there is nothing to liquidate. The pool is solvent by construction because the asset it owes never leaves the contract.
01The primitive · leverage = 1 / coverage
Coverage is the margin fraction. A leverager posts margin = coverage × notional, so the leverage they command is 1 / coverage. Their loss is capped at that margin.
leverage = 1 / coverage
loss ≤ margin — never liquidated
Coverage runs from the 5% floor to 99%: 5% → 20× · 50% → 2× · 95% → ~1.05×. Max leverage is 20×.
- Coverage ≥ 5% — the margin slice can never hit zero, so leverage is capped at 20×.
- Utilization ≤ 100% — traders can never rent more asset than lenders supplied; no naked exposure.
02Roles
- Holders / lenders — provide the coin and pick a coverage, get an ERC-6909 share at NAV, earn 90% of every premium pro-rata.
- Leveragers — rent the asset's upside above their entry, or short into the floor. Defined risk, no liquidation.
- Traders — the coin itself trades on its own Uniswap v2/v3 pool; the singleton reads that price and settles every close against it — no oracle.
- Creators — open a market for any asset; earn 5% of that market's premium forever.
- Stakers — stake HZN for a share of all protocol fees.
03Longs & shorts
The same covered pool is the counterparty to both directions. The floor that backs a long's leverage is the same floor that pre-funds a short's downside.
- ▲ Long — rent the upside. Post margin for the un-covered slice; the floor backs the rest. Profit on the asset's rise above entry. Loss capped at the premium — no margin call.
- ▼ Short — sell into the floor. The pool sells your notional at entry, holding the proceeds to rebuy. Profit when price falls. Loss capped at margin; past the band it simply forfeits.
Neither side can be liquidated. A position runs on its margin as fuel and self-closes when that premium is spent — swept onchain on the next interaction. No keeper, no oracle, no poke.
04Lender economics
A lender holds a covered book — it behaves like writing covered calls on the asset. Below: a $10,000 deposit at 50% coverage / 60% utilization, ETH starting $3,000, one year, with ~$750 of premium collected.
| Move | Horizon LP | 50/50 hold | All-in |
|---|---|---|---|
| −50% | −17.5% | −25% | −50% |
| −25% | −5.0% | −12.5% | −25% |
| flat | +7.5% | 0% | 0% |
| +25% | +12.5% | +12.5% | +25% |
| +50% | +17.5% | +25% | +50% |
| +100% | +27.5% | +50% | +100% |
| +200% | +47.5% | +100% | +200% |
Cushioned down, income flat, capped in a melt-up. The lender is structurally short volatility: they win in chop and drawdowns and give up the fat right tail. The catch — premium is highest exactly when demand (and the odds of a rally) are highest.
05Premium & fees
A demand-driven premium (a utilization curve) is metered by a single O(1) index. Longs and shorts pay it; it is capped at the position's margin, so there is no bad debt.
- Premium — 90% holders · 5% creator · 5% treasury
- Per-position fee (0.30%, each leg) — 90% holders · 5% creator · 5% treasury
- Treasury cut — → staking: 20% stakers · 80% dev
- HZN buy tax (1% on buys) — 50% dev · 50% stakers (USDC)
The holders' 90% is vested into NAV over a short window, so a close never jumps the price — a just-in-time minter can't skim it.
06The esHZN flywheel
Emissions never pay in liquid, dumpable tokens. Every reward is esHZN — escrowed and non-transferable. It has exactly two exits:
- Stake it — earn the protocol's real USDC fee flow, like staked HZN.
- Vest it — convert to liquid HZN linearly over a year, while locking an equal amount of HZN as collateral. You can't realize emissions without already holding HZN.
The loop: trade & provide → earn esHZN → stake or vest → become a long-term staker → deeper coverage and more leverage → more volume → more fees back to stakers. Mercenary volume is converted into aligned ownership.
07Tokenomics
33,000,000 HZN, fixed, minted once at deploy. No inflation — everything is distribution. ~68% is earned or bought by the community over time.
| Allocation | HZN | % |
|---|---|---|
| LP farm | 8.25M | 25% |
| Fee rebates | 8.25M | 25% |
| Dev-staked | 8.25M | 25% |
| Fair-launch seed | 3.0M | 9.1% |
| Faucet & remainder | 5.25M | 15.9% |
Launch is single-sided at a $1M fully-diluted mcap ($0.0303/HZN), seeded with HZN only — buyers supply the USDC as they walk the price up. No liquidity below the launch price.
08Product · COVERED
The flagship. Perpetual covered calls and defined-risk leverage on stock tokens and crypto — everything described above, live on Robinhood Chain. If you have sold a covered call at a brokerage, you already know how to use it: coverage is your strike distance, premium streams instead of settling at expiry, and there is no assignment.
09Roadmap · potential future products
COVERED is the only product live today. Everything below is exploratory — directions the covered-liquidity primitive makes possible, not committed features or dates. Each reuses the same solvent-by-construction pool, so none of it adds a new trust assumption.
- Cleave — the raw primitive. Split one unit of any asset into P (the covered side) and N (the upside) such that
P + N = 1, always, by construction. Mint the pair from the whole, redeem the pair for the whole, or trade either leg on its own — the composable parts behind COVERED, exposed directly. - Options — dated strikes. Traditional strike-and-expiry options written against the same pools. Where COVERED is perpetual and streaming, Options would be discrete and familiar: European-style payoffs settled at expiry by a real swap on the asset's own pool, never by an oracle print.
- Algostables — coverage-backed stable units. A stable unit collateralized by the covered floor rather than by over-collateralized debt, using the P / covered leg as principal-protected backing. No liquidation engine and no oracle peg-keeper — solvency stays arithmetic.
- Yield products — structured & principal-protected. Principal-protected notes, tranched vaults, and yield-tokenization built on Cleave: route premium and floor into senior / junior tranches so depositors can pick their own point on the risk curve.
One pool could underwrite all of these at once — liquidity deposited once would earn premium from every payoff shape built on top of it. Sequencing and scope depend on research and demand; treat this as intent, not a promise.
10Safety
- No oracle to break. Value-moving legs settle by a real swap on the pool behind a caller-supplied price band; redeem reads no price at all.
- No keeper. Positions self-expire when their fuel runs out — swept oracle-free on the next action.
- Solvent by construction. The contract holds the exact asset it owes and re-asserts the solvency invariant after every action.
- Defined risk both ways. A long's loss is its premium; a short's is its margin. Nothing cascades.