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The Assurance Pool accumulates a portion of transaction fees levied on network accounts, and stores them to underwrite the network’s credit risk.
The exact portion of transaction fee proceeds captured for Assurance is determined by a network’s Reserve to Debt Target (RTD). The RTD target is configured by the
AssuranceOraclecontract and defines the desired ratio between all outstanding debts and reserved funds.
The Assurance Pool accumulates all network fee proceeds until it reaches its RTD target. When the RTD target has been reached, all additional incoming fee proceeds are rerouted to the network’s Excess Balance from which networks can choose to withdraw from the pool however is seen fit.