Collateral & funding
How a maker's obligation is backed - credit, custody, maturity buckets, funding deadlines, and default.
Olive positions are fully collateralized by maturity, but not necessarily from the first second. This page explains what backs your payout, when, and what can go wrong.
What is reserved at entry
When your fill lands, the program reserves the maximum payout of your position — the most it could ever owe you — against the maker's capacity for that exact settlement asset. That reservation comes from two sources:
- On-chain prefunding already sitting in the maturity bucket, which is assigned first; and
- Credit, an admin-set limit for that maker and that exact token, which covers whatever remains.
Only your premium and the Olive fee actually move at entry. The maker's collateral obligation is recorded, not yet necessarily deposited.
Maturity buckets
Collateral lives in a funding bucket: an isolated program-owned account and token account holding one maker's obligations for one market family, one settlement asset, and one absolute maturity.
Buckets are isolated on purpose. A maker's problems in one maturity or one asset cannot reach into another bucket's collateral.
| State you may see | What it means |
|---|---|
credit-backed | Part of the bucket's obligation is not yet deposited on-chain |
funding-required | The funding deadline is approaching or passed and the bucket is short |
funded | The full obligation is on-chain in the bucket |
defaulted | The maker missed its deadline; the incident is open |
A bucket that was defaulted can be cured by funding it in full late, according to the program's rules.
The funding deadline
Every bucket has an on-chain funding deadline set ahead of its maturity. On the current deployment that lead time is 72 hours — collateral must be fully on-chain at least three days before the position settles.
Settlement is gated on funding. No position in a bucket can be redeemed until that bucket holds the full settlement asset it owes.
What backs credit before it is deposited
Credit is not an unsecured IOU, and it is also not an on-chain proof.
Before Olive grants a maker credit, Olive and that maker must have an effective tri-party custody and control agreement with BitGo for the relevant asset, reviewed so that the maker cannot withdraw or move the controlled collateral without Olive's approval. The configured credit limit is a governance risk decision made on the strength of that agreement.
The Solana program does not read BitGo, prove a custody balance, or move assets from custody. It enforces the limit, the reservation, the deadline, and the default machinery. Everything upstream of the limit is an off-chain legal and operational control.
This is the main counterparty risk in an Olive position. Between entry and the
funding deadline, a credit-backed position depends on the maker performing.
If a maker misses its deadline, the bucket defaults and the positions in it
cannot settle until it is cured. Check the funding state before you size up.
Limits that protect the pool
Beyond per-maker credit, each market carries on-chain caps that the program enforces on every fill: maximum call size, maximum put payout, and total outstanding call and put exposure for the market and its family. A ticket that would breach any of them is rejected at request time.
Next: Settlement ->