Last Resort Capital for Tokenized Assets

Every tokenized asset requires guaranteed liquidity backstops. This is not a feature specific to illiquid assets. It is a fundamental requirement for any asset used as collateral in credit markets.

Traditional finance has built this infrastructure over centuries. Central banks function as lenders of last resort. Market makers maintain contractual liquidity obligations. Prime brokers commit capital to their clients even during stress.

DeFi has none of this. Market makers can leave. Protocols cannot force liquidity. There is no backstop when markets freeze.

RAVA provides last resort capital through standing bid options and transparent settlement values. This infrastructure is universal. Every tokenized asset benefits from guaranteed execution at conservative prices.

When Markets Freeze

Liquidity disappears precisely when it is needed most. Assets that trade continuously under normal conditions become impossible to sell during stress. Order books evaporate. Slippage becomes extreme. Oracle prices exist but cannot be executed against.

The March 2020 crypto crash demonstrated this. Ethereum oracle prices showed $100 per ETH. But attempting to liquidate large positions revealed the illusion. Order books were thin. Execution required massive price concessions. Cascading liquidations found no buyers.

The quoted price was not the settlement price. Liquid assets became illiquid exactly when settlement was required.

This dynamic applies universally. Every asset, regardless of normal trading conditions, requires a guaranteed bid during stress. RAVA provides this through standing bid options priced using transparent settlement values.

Three Categories of Assets

Tokenized assets face different normal conditions but share the same need for last resort capital.

Assets with continuous pricing

These assets trade in liquid markets under normal conditions. Deep order books exist. Spreads are tight. Execution appears instant.

But stress transforms them. The order book collapses. Market makers withdraw. What appeared liquid becomes impossible to sell. Oracle prices persist but execution fails.

These assets require standing bids that guarantee settlement during the stress scenarios when traditional liquidity mechanisms break down.

Assets without continuous pricing

Real world assets, private credit, private equity, and infrastructure never have order books. There is no market to reference. NAV is reported quarterly and smoothed over time.

These assets always require settlement values. There is no normal state where continuous pricing exists. Last resort capital is the only capital.

RAVA provides transparent settlement values that make these assets safe to use as collateral despite having no market price.

Failed or distressed assets

When lending vaults experience defaults, vault token recovery becomes uncertain. Even if underlying collateral has oracle prices, the path from collateral to token holder is complex.

Recovery timelines extend for months. Legal structures complicate distributions. Seniority waterfalls create uncertainty about final amounts.

These assets require settlement values that account for recovery rates, time value of delayed distributions, and structural complexity.

Traditional Finance Has This Infrastructure

Every major financial institution maintains committed liquidity facilities. These are not market driven. They are contractual obligations to provide capital during stress.

Prime brokers commit balance sheet to client positions. Market makers sign liquidity agreements with exchanges. Central banks stand ready to inject capital when markets freeze.

This infrastructure prevents cascading failures. It ensures that price discovery continues even when normal market mechanisms break down.

The infrastructure is expensive to maintain. It sits idle during normal periods. But it is essential. Without it, every stress event becomes systemic.

DeFi Has No Equivalent

Decentralized markets lack institutional backstops. There is no central bank. Market makers are not contractually bound. Liquidity providers can withdraw at any time.

This creates fragility. Stress events cascade. Liquidations fail to find buyers. Oracle prices become misleading. The system assumes liquidity that does not exist.

Current solutions attempt to solve this through collateral requirements. Increase the over collateralization ratio. Make borrowers post more margin. Reduce leverage during volatility.

These approaches reduce risk but do not eliminate the fundamental problem. They do not create guaranteed settlement. They hope that higher collateral ratios will be sufficient. Hope is not infrastructure.

RAVA Provides Guaranteed Settlement

Standing bid options create contractual guarantees. Every whitelisted asset has a transparent settlement value. Any holder can execute against this value instantly. The bid is always available, regardless of market conditions.

This infrastructure serves the same function as traditional finance backstops but operates programmatically. No discretion. No favoritism. No reliance on institutional relationships.

Settlement values decompose into static and dynamic components. Static factors reflect structural characteristics that cannot be hedged. Dynamic adjustments track market conditions that sophisticated participants can hedge.

This transparency enables RAVA to commit capital. The settlement model is public. Risk is quantifiable. Capital providers can price their exposure and hedge the hedgeable components.

Traditional finance keeps settlement models proprietary. DeFi requires transparency. RAVA bridges this gap by making institutional settlement logic programmable and open.

Universal Infrastructure

Last resort capital is not a specialized service for niche assets. It is fundamental infrastructure that every credit market requires.

Liquid assets need guaranteed bids during stress. Illiquid assets need transparent settlement values always. Distressed assets need recovery frameworks that account for structural complexity.

RAVA provides all three through a unified settlement layer. Protocols integrate this infrastructure the same way they integrate price oracles. The difference is that RAVA provides settlement values instead of spot prices. Settlement values are more conservative, account for liquidity risk, and come with guaranteed execution.

This infrastructure makes tokenized assets safely composable. Protocols no longer need to build internal settlement models. They reference a shared standard that provides guaranteed liquidity when markets freeze.

RWAs as the Strongest Use Case

While RAVA's last resort capital infrastructure works for all tokenized assets, real world assets represent the strongest use case. RWAs combine maximum illiquidity with maximum structural complexity, making guaranteed settlement infrastructure not just useful but essential.

Private credit does not trade. Exit timelines extend 30 to 60 days even under normal conditions. NAV updates quarterly and lags market conditions. Legal structures involve multiple entity layers and waterfall payment mechanics.

Private equity extends these characteristics further. Exit timelines reach 60 to 90 days. NAV smoothing masks true volatility. Underlying holdings are themselves illiquid. Appraisals lag public market comparables by one to two quarters.

Real estate introduces appraisal dependency. Property valuations occur infrequently and reflect backwards looking assessments. Local market dynamics create idiosyncratic risks that broad market indices cannot capture.

These assets never have continuous pricing. They always require settlement models. But current private markets keep these models hidden. Borrowers never see the settlement logic that determines their borrowing capacity.

RAVA makes this logic transparent and programmable. RWA issuers can see exactly how settlement values are calculated. Lenders can trust that the values reflect proper risk adjustments. Liquidity providers can price their capital knowing settlement is guaranteed.

RWAs benefit most from last resort capital infrastructure because they cannot function without it there is no continuous pricing to fall back on. And traditional finance refuses to make the settlement models public, creating a barrier to on chain composability that RAVA removes.

The RWA Opportunity

Real world assets represent tens of trillions of dollars of value. Private credit markets have grown to $1.4 trillion. Private equity manages $4.7 trillion. Real estate dwarfs both.

None of this capital is composable on chain today. Tokenization is beginning but without settlement infrastructure, tokenized RWAs remain isolated. They cannot be borrowed against safely. They cannot support leverage. They cannot create liquidity.

Last resort capital infrastructure changes this. Settlement values make RWAs safe to use as collateral. Standing bids provide guaranteed exit paths. Transparent models enable protocols to lend confidently.

While RAVA's infrastructure serves all tokenized assets universally, RWAs represent the largest pool of value and the clearest need. They have no alternative there is no spot price, no order book, no fallback liquidity mechanism. For RWAs, settlement infrastructure is not optional.

Traditional finance already knows how to value these assets under stress. The models exist. The methodology is proven. RAVA translates this institutional knowledge into transparent, programmable infrastructure that DeFi requires.