Mechanics
The floor
The rule behind every Hardfloor coin, what each kind of trade does to the reserve, and why the floor never falls.
The rule
Every Hardfloor coin has its own floor reserve and a floor price set by one formula:
The floor reserve is the ETH behind the floor, plus any loans owed back to it (phase 2). Circulating supply is every coin held outside the pool, including coins locked as loan collateral (phase 2) and coins locked in the bridge adapter (phase 3), whose copies trade on other chains. Burned coins do not count.
The reserve holds ETH, so the floor is an amount of ETH per coin. It never falls in ETH, but its dollar value moves with the price of ETH, and the dollar figures in these docs are illustrative.
The floor is only as high as the reserve. $25,000 behind 800,000,000 coins makes a floor of $0.00003125, while $2,500 behind the same coins would make it $0.000003125. The rule makes sure the reserve can always pay the floor. It does not make the floor high: the raise target sets where it starts, and trades and fees raise it from there.
What each trade does
| Event | What happens to the reserve |
|---|---|
| Buy | Floor price × coins bought moves from the payment into the reserve, so new coins are backed at the current floor. |
| Sell above the floor | That backing goes back to the pool before the sale settles. |
| Sell at the floor | The reserve pays exactly the floor price, and the coins go back into the pool for the next buyer. |
| Fees and Floor Wars payouts | Added to the reserve. Nothing is taken out. |
The first three rows change the reserve and circulating supply in the same proportion, so the floor price holds. The fee on each trade falls under the last row, which is why the floor ticks up a little on every trade. A buy's floor fee is spread over the coins circulating after it, and a sell's over the coins circulating before it, so when you sell, your own share of that fee comes back to you. No single trade can lift the floor by more than its own floor fee.
While fewer than 1,000 coins circulate, there are too few to spread money over: the floor stays where it is, and anything in the reserve above the floor's backing goes to the Floor Wars pot. So when everyone sells out of a coin, the next buyer pays the floor and cannot claim what was left behind.
That makes the reserve a standing buyback. It buys back coins sold at the floor, and every trade's fee adds to its buying power, so the floor gets stronger and higher the more the coin trades.
Why the floor never falls
The floor could only fall if money left the reserve without the matching coins leaving circulation, and the contract does not allow that. Returned backing and sales at the floor remove floor price × coins while those coins leave circulating supply. A loan (phase 2) moves cash out, but the loan is owed back and still counts toward the reserve, and the locked coins still count as circulating. If the loan is not repaid, the locked coins are sold like any other coins, removing floor price × coins as they leave circulation, and the proceeds pay the loan back. Everything else only adds.
So the reserve can always pay the floor price for the coins in circulation, and the floor never goes down. What the rule cannot do is make the floor high: that takes money coming in through bonding, trades and fees. This is enforced by the contract and checked by invariant tests (see Security).
A worked example
Illustrative numbers from the bonding example: a $50k raise with 80% of supply sold leaves a $25,000 reserve and 800,000,000 circulating coins. Fees are left out of steps 2, 3 and 5 and added on their own in step 4.
| Step | Reserve | Circulating | Floor price |
|---|---|---|---|
| 1. Bonding completes | $25,000 | 800,000,000 | $0.00003125 |
| 2. Buy 80,000,000 coins: $2,500 of the payment moves into the reserve | $27,500 | 880,000,000 | $0.00003125 |
| 3. Sell them above the floor: the $2,500 backing returns to the pool | $25,000 | 800,000,000 | $0.00003125 |
| 4. $1,000,000 of trading pays $5,000 in fees into the reserve | $30,000 | 800,000,000 | $0.0000375 |
| 5. Sell 80,000,000 coins at the floor: the reserve pays $3,000 | $27,000 | 720,000,000 | $0.0000375 |
The floor rose 20% on fees and held through every buy and sell. It did not hold the price up: at bonding the floor was about 12.5% of the price, so the price had a long way to fall before reaching it.
What the floor is not
- Not a promise that the price goes up. The floor limits how low a coin can trade, nothing more.
- Not a floor under what you paid. Buy well above the floor, and the price can fall all the way to it.
- Not growth on its own. The floor rises only when the coin trades.
- Not high compared with the price. At launch the floor is set by the raise target, $0.00003125 on a $50k target, and once more than half of the supply has sold the price climbs far above it.
- Not a payout after fees. A sale at the floor still pays the 1.25% trading fee, so you receive about 98.75% of the floor value, a little more if you hold a large share of the coins.
- Not a shield against bugs. The floor is enforced by the contract, and contracts can have bugs (see Risks).
The design follows Baseline's floor model, rebuilt as a Uniswap v4 hook. The exact position math is finalized and audited in phase 1.