Flow of Funds

The Power Finance architecture separates capital into two layers: $PWRd, a reserve-backed synthetic dollar, and $PWRs, a staked value-accrual token. Each has a defined and auditable flow of funds.

$PWRd Minting

Users deposit USD or approved stablecoins with the issuer or its onboarding partner such as M0. The issuer then places these funds with the reserve custodian in segregated, bankruptcy-remote accounts and invests them in short-term U.S. Treasury bills and cash equivalents. Once the deposit is verified, the reserves trigger the onchain minting of $PWRd to the user’s whitelisted wallet.

$PWRs Staking

Users stake $PWRd into the $PWRs contract. The contract allocates an equivalent amount of reserves to managed accounts that participate in approved power and volatility derivative strategies. As these strategies earn returns, the redemption value of $PWRs increases proportionally.

Redemption

When users burn $PWRd onchain, they receive USD or stablecoins from the reserves. When they redeem $PWRs, they receive an increasing amount of $PWRd that reflects the accumulated yield from the staked portfolio.

Transparency

All reserve and yield movements are recorded offchain by custodians and mirrored onchain through attestation feeds. Each flow preserves exposure linkage between token balances and the underlying reserve assets.