How Robin Tracks and Distributes Yield
Robin introduces a yield-bearing layer to prediction markets by directing idle capital into DeFi protocols. To ensure that this yield is distributed fairly, Robin uses a non-transferable internal accounting system called vault scores.
Unlike typical vaults where yield accrues continuously and can be withdrawn at any time, Robin locks yield until a market resolves. This ensures that only committed capital earns returns and aligns the economic incentives of liquidity providers and traders with the structure of prediction markets.
Vault Scores and Yield Allocation
When a user mints YES and NO tokens by depositing USDC into a Robin market, they receive vault scores that represent a claim on the yield generated by that capital.
Vault scores are tied to the originating wallet and are not transferable.
Yield can only be claimed at the end of the market by the wallet that originally deposited funds.
Vault scores are used only for accounting — they cannot be traded, transferred, or separated from the original wallet.
This setup ensures that yield is only available to participants who directly contributed to the capital base of the system.
Yield Accrual: Time-Based Accounting
Robin tracks yield accumulation on a per-second basis. Each wallet's vault scores increase in value relative to how many blocks it has held a valid yield-bearing position. This allows the system to calculate yield score precisely, even when users enter and exit at different times.
This method has two major advantages:
Accurate yield distribution: Long-term participants who keep their capital in the system for the majority of the market duration earn proportionally more yield.
Flexible incentive design: The same accounting model can be extended to reward traders who generate liquidity and volume — by assigning time-based points proportional to their cumulative trade activity.
Rewarding Traders
In addition to LPs, Robin can reward traders using the same time-based accounting mechanism:
Traders accumulate “participation points” for conditional tokens held.
These points are tracked per second and per market.
At market resolution, a portion of the generated yield is allocated to traders proportionally based on these participation points.
This creates a secondary incentive layer that rewards active, value-generating users — without introducing inflationary rewards or relying on token emissions.
Yield shared with traders comes from the same pool as LP yield, with the split defined by protocol parameters (e.g., 85% to LPs, 15% to traders). This mechanism ensures that all yield is backed by real capital productivity and not speculative incentives.
Withdrawing Before Market Resolution
While yield is locked until the market resolves, Robin allows users to withdraw their USDC early — but only under specific conditions designed to preserve fairness and prevent manipulation.
Each wallet is permitted to burn and redeem only as many YES/NO tokens as it originally minted. This means that users can retrieve up to their original USDC contribution before resolution, but no more.
This rule exists to prevent a class of exploits where users could:
Mint YES/NO tokens and receive vault scores.
Transfer those tokens to another wallet.
Burn the tokens in the second wallet and withdraw more USDC than they originally deposited — while avoiding yield penalties.
In Robin’s model, yield entitlement is based on how much capital a wallet has contributed and how long that capital has remained in the system. It is not tied to token ownership or token balance at market resolution.
Because vault scores are non-transferable, and token transfers are permissionless, the only robust way to prevent exploits is to enforce mint-burn parity per wallet.
If a user holds additional YES/NO tokens beyond what they personally minted — for example, by purchasing them on the secondary market — they will not be able to redeem those tokens for USDC early. Instead, they have two options:
Wait until the market resolves and redeem the winning tokens for $1 each.
Sell the tokens back into the market through Robin’s AMM to recover USDC from other participants.
This ensures that vault scores remain accurate, unmanipulated, and strictly tied to capital contribution, while still allowing for open market trading of prediction tokens.
Design Philosophy
Robin’s yield system is based on the principle that only wallets that keep capital in the system over time should benefit from the yield generated by that capital. The use of time-based tracking enforces this precisely and transparently.
Participants who:
Provide liquidity early,
Keep capital committed through market resolution, and
Avoid extracting more than they deposited,
are rewarded with their full share of DeFi yield. Traders who contribute to market efficiency through volume are also rewarded, but only in proportion to their long-term activity — not short-term manipulation.
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