3. The Yield Swap

At the foundation of RAVA is the yield swap contract.

Each RWA holder (a party that owns a productive real-world asset) enters into a swap with RAVA.

Let the asset produce a sequence of realized cashflows C = {c₁, c₂, …, cₜ} over discrete time intervals t = 1, …, T.

The RWA holder transfers the right to receive all elements of C to RAVA.

In exchange, RAVA provides immediate liquidity in the form of rFund tokens, denoted fᵢ, whose value reflects the discounted expectation of those cashflows.

The holder retains the asset itself, denoted A, but no longer owns the stream of returns associated with it:

    A = ownership,    C = performance sold to RAVA.

RAVA aggregates these purchased yield streams into a single economic dataset.

The LP retains ownership of their original position. But now that position generates trading fee income from the rFund market. This transforms a locked asset into an income producing position that can be borrowed against using actual cashflow, not projected NAV.