nToken Redemption

We can best demonstrate the redemption process with an example. Assume that the below nToken account has 100 nTokens outstanding and a user wishes to redeem 10 nTokens.
nToken account:
cTokens: +100
 Maturity
Liquidity Tokens
fCash
June 1 2021
+200
-200
September 1 2021
+300
-300
December 1 2021
+500
-500
Note: the below example uses arbitrary values for the ratios of liquidity token cash claims to fCash claims in step 2, and arbitrary exchange rates between fCash and cTokens in step 4.
Step 1
Upon redemption, Notional calculates the redemption share - the share of the total supply of nTokens that the user is redeeming.
redemption share=.1redemption \text{ } share = .1redemption share=.1
Step 2
Notional converts the nToken account's liquidity tokens to cTokens and fCash in memory. 
nToken net fCash and cToken holdings:
cTokens: +1100
 Maturity
fCash
June 1 2021
+100
September 1 2021
+150
December 1 2021
+250
Step 3
Notional applies the redemption share to the nToken's cToken balance and each net fCash balance.
User share of net nToken holdings:
cTokens: +110
 Maturity
fCash
June 1 2021
+10
September 1 2021
+15
December 1 2021
+25
Step 4
Notional trades the user's share of each fCash balance for cTokens via the corresponding liquidity pools.
Converted fCash holdings:
cTokens: +110
 Maturity
cTokens
June 1 2021
+9
September 1 2021
+13
December 1 2021
+23
Step 5
Notional returns a net cToken amount to the user.
net cTokens to user=110+9+13+23 net cTokens to user=155net \text{ }cTokens \text { } to \text{ } user= 110 + 9 + 13 + 23 \\~\\ net \text{ }cTokens \text { } to \text{ } user = 155net cTokens to user=110+9+13+23 net cTokens to user=155

Last modified 2yr ago

Maturity	Liquidity Tokens	fCash
June 1 2021	+200	-200
September 1 2021	+300	-300
December 1 2021	+500	-500

Maturity	fCash
June 1 2021	+100
September 1 2021	+150
December 1 2021	+250

Maturity	fCash
June 1 2021	+10
September 1 2021	+15
December 1 2021	+25

Maturity	cTokens
June 1 2021	+9
September 1 2021	+13
December 1 2021	+23