Strategy
Liquidity. Three paths, one rule.
A hybrid basket cannot be fully liquid. The holder picks the exit that matches their urgency. The fast path is priced at what it costs the remaining holders. That fee is paid back to the holders who stayed.
Background
65 percent of the basket is daily liquid. 30 percent is private funds that cannot be sold mid cycle. A naive redemption design forces sales of the liquid sleeve to meet exits, which leaves remaining holders with a portfolio more illiquid than they bought. RWY prices that damage and routes it back to the holders who absorbed it.
Three redemption paths
The holder picks one based on urgency.
- Track A. Standard queue. T plus 30. NAV at queue close. No fee. The default path.
- Track B. Instant burn. Same block. Paid in USDC. Fee of 0 to 5 percent depending on how depleted the liquid sleeve is when the holder exits.
- Track C. Secondary RFQ. Bilateral trade between allowlisted holders. Price negotiated. No fund fee.
Most holders never need anything beyond Track A. The cash flow needs that look like redemptions usually are not. The USDC borrow facility against the token covers them without realizing NAV at all.
The Track B fee
The instant burn fee scales with how depleted the liquid sleeve is at the moment of exit. Healthy sleeve, no fee. Depleted sleeve, higher fee. The fee tracks the actual cost the exit imposes on remaining holders.
| Liquid sleeve depth | Fee |
|---|---|
| At or above target | 0 percent |
| 70 to 90 percent of target | 0.5 percent |
| 50 to 70 percent of target | 2 percent |
| 30 to 50 percent of target | 4.5 percent |
| Below 30 percent of target | 5 percent cap |
Single large exits pay an additional surcharge that scales with the size of the exit relative to the fund. A 10 percent of NAV exit pays an extra 1 percent on top of the depth fee. This prices the price impact a single large redemption creates.
Where the fee goes
The fee never accrues to Navmont. It is paid back to remaining holders.
- First 0.5 percent of NAV per month goes to the monthly distribution. A visible boost on the next payout. Every holder of record shares it.
- Above that, 80 percent goes to loyal holders. Any wallet that did not redeem or sell on the secondary in the prior 30 days. The math flips during stress: staying pays more than leaving.
- The remaining 20 percent funds the liquidity restoration auction. The reserve that pays the discount to new subscribers refilling the liquid sleeve.
Defense layers
When stress lasts longer than a single event, three mechanisms cover the gap.
Claim token split
At very low sleeve depth, Track B pays out partly in USDC and partly in a claim token on the private sleeve. The redeemer keeps their pro rata exposure to the illiquid positions and receives cash from those positions as they mature. The fund never has to fire sale a private credit line to fund a fast exit.
Liquidity restoration auction
When the sleeve drops below 75 percent of target and stays there for more than 24 hours, an auction opens. Allowlisted subscribers can buy in at a discount to NAV that scales with depth. New capital refills the sleeve at a documented yield premium. Funded by the reserve built up from Track B fees.
Standby liquidity facility
A syndicated commitment from Navmont Credit and institutional partners stands ready to subscribe at auction prices when organic demand is insufficient. Each counterparty has a daily loss cap and an individual pause rail, so one drawdown does not exhaust the facility.
Phase activation
The full mechanism does not run at launch. Activation tracks fund maturity.
- Phase 1. Private sleeve is a cash placeholder. Track A and Track B with a flat 0 percent fee plus the size surcharge. CRWY, auction, and standby disabled.
- Phase 1.5. Private sleeve partially invested. Track B fee muted at 1 percent maximum. CRWY optional.
- Phase 2. Private sleeve fully active and AUM above $50M. Full mechanism live.
The bottom line
Three paths. The fast path costs what damage it does. That cost flows back to the holders who stayed. The defense layers cover the cases where organic demand is not enough. The mechanism scales with the fund.
The private sleeve is never sold to fund a redemption. The liquid sleeve absorbs the routine flow. Pricing and queueing absorb the stress flow. The standby covers the tail.