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Documentation Index

Fetch the complete documentation index at: https://mintlify.com/reserve-protocol/reserve-index-dtf/llms.txt

Use this file to discover all available pages before exploring further.

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General Questions

Reserve Folio is a protocol for creating and managing portfolios of ERC20-compliant assets entirely onchain. Folios are designed to be used as a single source of truth for asset allocations, enabling composability of complex, multi-asset portfolios.Think of it as an onchain index fund or ETF, but fully decentralized and programmable.
Key Differentiators:
  1. Sophisticated Rebalancing: Dutch auction system with configurable price ranges and basket-level optimization
  2. Governance Flexibility: Three-tier role system allowing different levels of control and time sensitivity
  3. High Fidelity: Designed to maintain precise allocations even under timelock delays
  4. MEV Protection: Integration with trusted fillers (CoW Swap) for better execution
  5. Composability: Can be used as collateral or building block in other DeFi protocols
Folio works on any EVM-compatible chain with block times ≤ 30 seconds.Commonly targeted chains:
  • Ethereum Mainnet
  • Base
  • Arbitrum
  • Optimism
  • Polygon
See Chain Assumptions for details.
Yes! Multiple comprehensive audits by leading firms:
  • Trust Security (v1.0.0)
  • Cantina Competition (multiple versions)
  • Trail of Bits (v2.0.0, v4.0.0)
  • Pashov Audit Group (v4.0.0+)
See Security Audits for full details.

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Using Folios

To mint Folio tokens:
  1. Approve each collateral token for the Folio contract
  2. Call mint(uint256 shares, uint256 minAmountOut) with desired share amount
  3. The Folio calculates required token amounts pro-rata
  4. Tokens are transferred from your wallet
  5. Folio shares are minted to your address
Fees: Mint fee applies (configurable, minimum 15 bps)See the Minting & Redeeming guide for details.
To redeem Folio tokens:
  1. Call redeem(uint256 shares) with the amount to redeem
  2. The Folio calculates token amounts pro-rata to your share
  3. Your Folio shares are burned
  4. Collateral tokens are sent to your address
Fees: No redemption fee (only mint and TVL fees)Note: You receive all tokens in the basket proportionally.
Two types of fees:
  1. TVL Fee (Management Fee):
    • Charged continuously on AUM
    • Minimum: 15 bps annually
    • Maximum: 10% annually
    • Implemented as share inflation
  2. Mint Fee:
    • Charged on minting
    • Minimum: 15 bps
    • Maximum: 5%
    • No redemption fee
DAO Fee Floor: 15 bps goes to ecosystem DAO (can be lowered by DAO)See Fee Structure for details.
Yes! Folio tokens are standard ERC20 tokens and can be used as collateral in other DeFi protocols.Considerations:
  • Check for read-only reentrancy with stateChangeActive()
  • Folio composition can change through rebalancing
  • Value should be calculated based on underlying assets

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Rebalancing & Auctions

Rebalancing follows a structured process:
  1. Start Rebalance: REBALANCE_MANAGER sets target weights and price ranges
  2. Open Auction: AUCTION_LAUNCHER or anyone (after delay) opens an auction
  3. Bidding: Anyone can bid on token pairs during the auction
  4. Repeat: Multiple auctions can run during the rebalance
  5. Complete: Rebalance completes when targets are met or TTL expires
See Rebalancing for comprehensive details.
A Dutch auction starts at a high price and decreases over time until a buyer accepts.In Reserve Folio:
  • Price decays exponentially from startPrice to endPrice
  • Designed so ideal clearing price (with slippage) lies between bounds
  • First bidder to accept current price wins
  • Can be filled partially or fully
Benefits:
  • Price discovery
  • No order book needed
  • MEV-resistant (with tight ranges)
Yes! Auctions are permissionless by default.To participate:
  1. Call getBid() to see current auction state
  2. Call bid() with desired fill amount
  3. Send buy tokens, receive sell tokens
Requirements:
  • Must meet the current price ratio
  • Must have approved buy token
  • Some Folios may restrict to trusted fillers only
Profit opportunity: Buy at better prices than secondary markets during rebalancing.
Trusted fillers are whitelisted entities that can provide async fills for auctions.Current Implementation: CoW Swap integrationBenefits:
  • Better prices through professional market makers
  • MEV protection
  • Access to off-chain liquidity
Configuration: Can be enabled/disabled per Folio by governanceRestrictions: Some Folios may disable permissionless bids and only allow trusted fillers.
Common reasons:
  1. TTL Expired: Rebalance time-to-live ran out
  2. Price Excursion: Market prices moved outside approved ranges
  3. Auction Launcher Offline: No one opened auctions during restricted period
  4. Insufficient Liquidity: No bidders at auction prices
  5. Governance Action: Rebalance manually ended
Recovery: Start a new rebalance with updated parameters.

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Governance

Folios have a three-tier governance system:
  1. DEFAULT_ADMIN_ROLE:
    • Expected: Timelock of Slow Folio Governor
    • Powers: Add/remove assets, set fees, configure roles
    • Use: Major structural changes
  2. REBALANCE_MANAGER:
    • Expected: Timelock of Fast Folio Governor
    • Powers: Start/end rebalances, set rebalance parameters
    • Use: Operational rebalancing decisions
  3. AUCTION_LAUNCHER:
    • Expected: EOA or multisig
    • Powers: Open auctions within approved ranges
    • Use: Timely auction execution with market awareness
See Roles for details.
Changes are proposed through the governance system:
  1. Create Proposal: Submit proposal to appropriate governor
  2. Voting Period: Token holders vote
  3. Timelock: Successful proposals enter timelock
  4. Execution: After delay, proposal can be executed
Which Governor?
  • Slow Governor: Structural changes (add/remove tokens, fees)
  • Fast Governor: Rebalancing operations
  • Direct: AUCTION_LAUNCHER for auction timing
The AUCTION_LAUNCHER is a semi-trusted role that opens auctions.Responsibilities:
  • Open auctions promptly when rebalancing is needed
  • Provide up-to-date price estimates (if price control enabled)
  • Optimize basket weights (if weight control enabled)
  • End rebalances if market conditions become dangerous
Limitations:
  • Can only operate within governance-approved ranges
  • Cannot prevent permissionless auctions (after delay)
  • Cannot steal funds (but can cause value leakage in some configurations)
Fallback: If offline, anyone can open auctions after restricted period.
Short answer: Not immediately, but governance has significant power.Protections:
  • Timelock delays on major changes
  • Cannot directly steal user funds
  • Users can redeem during timelock period
Risks:
  • Can add malicious tokens (users should redeem before they’re added)
  • Can set unfavorable rebalance parameters
  • Can change fees (within limits)
Best Practice: Monitor governance proposals and redeem if you disagree with changes.

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Staking

The StakingVault holds staked Folio tokens and distributes rewards.Features:
  • Stake Folio tokens
  • Earn multiple reward tokens simultaneously
  • Voting power for governance
  • Configurable unstaking delay
Use: Central voting token for all Folio governance types.
Rewards are distributed continuously based on staked balances.Mechanism:
  • Rewards drip at a configurable rate
  • Rate decays with a half-life (exponential decay)
  • Multiple reward tokens supported simultaneously
  • Claim anytime
Configuration: Controlled by StakingVault owner (Community Governor).
An optional delay before staked tokens can be withdrawn.Purpose:
  • Prevent governance attacks (stake, vote, unstake)
  • Align long-term interests
  • Security for optimistic governance
Configuration: Set by StakingVault owner, can be 0 (no delay).
In v5.0.0+, yes - through optimistic governance slashing.Mechanism: StakingVault.burn() functionUse Case: Slash malicious governance proposers in optimistic governance systemsRisk: Only applies if the Folio uses optimistic governance patternsMitigation: Don’t propose malicious governance actions.

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Technical Questions

Supported:
  • Standard ERC20 tokens
  • Tokens with missing return values
  • Tokens that revert on zero-value transfers
  • Flash mintable tokens
  • Rebasing tokens (Folio only, with caveats)
NOT Supported:
  • Multiple entrypoints
  • Pausable / blocklist (USDC, USDT risky)
  • Fee-on-transfer
  • ERC777 / callback tokens
  • Rebasing tokens (StakingVault)
See Token Compatibility for details.
Folio Collateral: ≤ 27 decimalsStakingVault Tokens: ≤ 21 decimalsReason: Prevents overflow with D18/D27 precision multipliers.See Valid Ranges for more limits.
Before relying on Folio state in external contracts:
(bool rebalanceActive, bool asyncActionActive) = folio.stateChangeActive();
require(!rebalanceActive && !asyncActionActive, "State change active");
Why: Protects against read-only reentrancyWhen: Before reading Folio balances or using Folio tokens as collateral
Folio uses a comprehensive unit system with precision multipliers:
  • D18: 1e18 precision (percentages, ratios)
  • D27: 1e27 precision (prices, exchange rates)
  • , , : Token amounts
  • : Seconds
Examples:
  • D18{1}: Percentage with 18 decimals
  • D27{tok/share}: Token per share ratio
  • D27{UoA/tok}: Price in nanoUSD per token
See Unit System for details.
Yes! Reserve Folio is open source.Steps:
  1. Clone the repository
  2. Review deployment scripts
  3. Configure parameters
  4. Deploy via governance deployer
  5. Initialize with tokens and settings
Requirements:
  • RoleRegistry deployment
  • FolioDAOFeeRegistry setup
  • Governance structure
See Development for details.

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Troubleshooting

Common reasons:
  1. Insufficient Allowance: Approve all collateral tokens first
  2. Insufficient Balance: Don’t have enough of one or more tokens
  3. Below Minimum: Output below minAmountOut parameter
  4. Zero Output: Would receive 0 shares (add more tokens)
  5. Token Transfer Failed: One of the collateral tokens reverted
Solution: Check allowances, balances, and token compatibility.
Possible reasons:
  1. Insufficient Balance: Don’t have enough Folio shares
  2. Token Removed: A token was removed from basket (rare, governance action)
  3. Rebalancing Issue: Temporary issue during rebalance (unlikely)
Solution: Check your share balance and Folio basket composition.
If a token doesn’t appear after redeeming:
  1. Check Balance: View token balance in wallet
  2. Add to Wallet: Manually add token contract address to wallet
  3. Check Basket: Verify token is still in Folio basket
  4. Check Transaction: Review transaction logs for transfers
Remember: Redemptions are pro-rata - you get small amounts of each token.
Gas costs vary significantly by chain:
  • Ethereum Mainnet: $50-200+ (high)
  • Base/Optimism: $1-5 (low)
  • Arbitrum: $0.50-2 (very low)
  • Polygon: under $0.50 (very low)
Tips:
  • Use L2s for lower costs
  • Wait for low gas periods (weekends, late night UTC)
  • Batch operations when possible

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Getting Help

Need More Help?

Resources:Before asking:
  1. Search this FAQ
  2. Check relevant documentation section
  3. Review example transactions on block explorer
  4. Provide details: transaction hash, wallet address, error message

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