Every LTU contract is built from two legs: the asset you acquire and the obligation you lock. The relationship between them defines your payoff profile, Asset-Led, Obligation-Led, Peg, or Spread. Derived automatically, disclosed before you commit.
Informational by design. Same contract, same protections, same capped loss in every classification.
The classification is determined by the volatility character of each leg relative to the other. A “Stable-Value Unit” is a fiat currency or fiat-referenced stablecoin; a “Volatile Asset” is any other supported digital asset. One rule applies in every case: the asset you acquire may never be economically equivalent to the obligation you owe.
| Acquired leg | Obligation unit | Classification | Obligation mode |
|---|---|---|---|
| Volatile Asset | Stable-Value Unit | Asset-Led | Fiat Obligation Mode |
| Stable-Value Unit | Volatile Asset | Obligation-Led | Asset Obligation Mode |
| Stable-Value Unit | Stable-Value Unit (distinct reference) | Peg | Fiat Obligation Mode |
| Volatile Asset | Volatile Asset (distinct asset) | Spread | Asset Obligation Mode |
TWO CHOICES IN. ONE CLASSIFICATION OUT. NO AMBIGUITY.
Asset-Led
You acquire a volatile asset with a stable obligation locked at execution. If the asset appreciates over the tenor, everything above your obligation returns to you as surplus at buyout. If it depreciates, your loss is bounded by the Origination Fee. Typical use: a long view on an asset for a defined period, without ownership commitment.
Obligation-Led
You hold stable value but owe a volatile asset locked at execution. If the owed asset gets cheaper before buyout, less of your held value is needed to discharge the obligation, the remainder is surplus. If it rises, HyperHedge absorbs the shortfall and your loss stays capped at the fee. Typical use: a bearish view without leverage or liquidation risk.
Peg
Both legs are stable-value units with distinct references. The relationship is anchored by design; the outcome derives mainly from structural terms, tenor and fee, rather than market direction. Residual risks are peg weakening and FX drift between two fiats. Typical use: low-volatility, structured access over a defined tenor.
Spread
Both legs are distinct volatile assets. Your outcome is the relative performance of the acquired asset against the obligation asset. Surplus arises where the acquired asset outperforms, even in a broadly falling market. Underperformance is capped at the fee. Typical use: a relative-value view between two assets, like ETH versus BTC.
EVERY PROFILE SHARES THE SAME FLOOR: YOUR MAXIMUM LOSS IS THE ORIGINATION FEE.
The two most common profiles, worked through with real numbers. In both, the obligation is locked at execution, no payments occur during the tenor, and HyperHedge covers any shortfall at settlement.
Asset-Led · Long View
Open LTU on 1 BTC · Obligation Unit = USD
At execution: BTC = $100,000 → obligation locked at $100,000
At Maturity Settlement
- BTC at $120,000~0.833 BTC settles the obligation; ~0.167 BTC returned to you.Surplus
- BTC at $100,000The contract settles exactly.Exact
- BTC at $80,000Entire BTC liquidated ($80,000); HyperHedge absorbs the $20,000 shortfall, you owe nothing beyond the fee already paid.Covered
Obligation-Led · Short View
Open LTU acquiring 100,000 USDC · Obligation Unit = BTC
At execution: BTC = $100,000 → obligation locked at 1 BTC
At Maturity Settlement
- BTC at $80,000$80,000 of USDC buys the 1 BTC owed; $20,000 returned to you.Surplus
- BTC at $100,000The contract settles exactly.Exact
- BTC at $120,000100,000 USDC is insufficient; HyperHedge absorbs the shortfall, you owe nothing beyond the fee already paid.Covered
Illustrative figures at the Platform Reference Price. The Origination Fee is paid separately at execution and is not part of the Total Obligation.
UP, FLAT, OR DOWN, THE OUTCOME IS DEFINED BEFORE YOU OPEN.
The Contract Classification is a descriptive characterisation of your payoff profile, inherited from the LTO framework and expressed in LTU's buyout-based settlement terms. It exists to make your position easier to understand, not to change what it is.
Derived Automatically
The classification is computed from your selected asset and obligation unit at execution and recorded in your contract schedule. You never choose a classification, you choose two legs, and the label follows.
Changes Nothing Structural
It does not alter the obligation mode, the Conditional Sale foundation, the single-fee model, the maximum-loss cap, or any settlement mechanic. Where any tension of interpretation arises, the contract terms prevail.
Full Disclosure
Your classification is shown at deal construction and confirmed in your contract schedule, together with the obligation mode. Classification-specific risk is disclosed in the Risk Disclosure Statement.
ONE CONTRACT ARCHITECTURE. FOUR WAYS TO READ IT.
Markets reward views.
Structures reward clarity.
LTU gives you both.
LTU payoff profiles, disclosed upfront
Pick your two legs and see your classification, fee, and locked obligation before you confirm, every time.