Risks

A stream is a bet on fees nobody can promise. This page sets out how it can go wrong, who carries the loss when it does, and what Flume does about each case. Read it before you sell, and before you deposit.

For the vault and its LPs

Fees stop

Once paid, a creator can stop paying fees into the source, or the token can stop trading. Either way the stream brings in less than its price.

There is no recourse: the vault keeps what arrived and carries the difference. This is the main risk Flume prices for. The vault pays a quarter of what the last week projects, so a stream needs to bring in a quarter of that projection to pay the vault back. It buys at most half of a stream, for at most thirty days, and the creator keeps the rest of every fee.

A week that flatters

A source's history is whatever was paid into it, and Flume can't tell trading fees from a creator's own money paid in to make the week look better. A source can also have an honest strong week just before it sells, and fade after.

The price never exceeds what the week took in, and a quote needs fees on at least four separate days, so a single large payment isn't enough. What limits the damage is size: no purchase can exceed 10% of the vault's free cash, and one creator's streams together can't exceed 10% of the vault.

Concentration and size

A large stream that fails hurts more than a small one. No single purchase can exceed 10% of the vault's free cash, one creator is held to 10% of the vault across all their streams, and the vault keeps at least 30% of its money in cash. The program enforces its own floor under these: 10% per purchase and 20% in reserve, whatever a quote says.

Locked deposits

While any stream is open, LP cash can't leave the vault. Terms end within thirty days and anyone can settle an ended stream, but a stream with unsold SOL can't settle until that SOL is sold. The vault page shows which streams are holding it shut.

SOL needs a buyer

The vault's share of fees paid in SOL is sold for USDC through a firm quote that a buyer and the vault's quote key both sign, at no less than the vault's minimum rate. If no buyer takes the SOL, settlement waits. What the vault is owed doesn't change while it waits. See Fees paid in SOL.

For creators

You give up part of your fees

For the term, the vault's share of every fee is the vault's, up to its cap. If your token does better than its last week, you'll have sold that upside cheaply, up to twice the price.

Your keys are the source's keys

Only the creator wallet can claim the creator side or sell from a source, and a source can't be moved to another wallet. If that wallet is lost, so is access to the source.

For everyone

Keys and code

Flume's quote key co-signs every purchase and SOL sale. A leaked quote key could sign bad quotes, but each one still has to fit the program's limits and needs the creator's signature too. The vault admin can switch the pricing model only while no stream is open. Whoever holds the program's upgrade authority could replace the program. Contracts and keys shows each of these keys, read live from the chain.

USDC and Solana

The vault holds USDC, and its issuer can freeze USDC accounts. Flume runs on Solana and depends on the network accepting and finalizing transactions.

Rules where you live

Selling rights to future revenue, or buying them, may be regulated where you live. Check before you use Flume.