Introduction

This section covers the nToken specific governance parameters.

nTokens

nTokens enable users to passively earn returns from providing liquidity to Notional across all active maturities without requiring them to interact with the individual liquidity pools in any way. nTokens are ERC20 assets that are redeemable for a share of Notional’s total liquidity in a given currency across all active maturities. Each asset that Notional supports for borrowing and lending will have its own nToken ex. nDAI, nUSDC, nETH. Find more detail about nTokens attributes here.

Purpose of nToken governance parameters

nToken governance parameters influence how an nToken account distributes an LP's liquidity to individual liquidity pools and how it composes with fCash residuals upon a quarterly roll according to the following parameters:

• Deposit shares;

• Leverage thresholds;

• Residuals purchase incentives;

• Cash witholding buffer

• Residuals time buffer.

The purpose of these governance parameters is to:

• Optimize how liquidity is distributed amongst liquidity pools;

• Optimize returns for nToken holders;

• Handle fCash residuals.