RedStone Brings Instant Exits to Tokenized NYLIM Fund
RedStone has integrated its Settle service with Centrifuge's NYLIM U.S. High-Yield Corporate Bond Segregated Portfolio (HYB) fund, allowing holders to exit within one blockchain transaction. The integration is designed for same-block exits through offchain auctions lasting approximately 300 milliseconds.
KYC-approved liquidity providers will bid on the discount required to purchase fund units immediately. The auction starts with a price taken from the fund administrator's net asset value (NAV) data, derived from the administrator's NAV feed. Solvers then compete by submitting the percentage discount they require to acquire and redeem the units.
RedStone Settle uses atomic transactions and bonded solver deposits to limit failed settlement and front-running. The winning solver has a bonded deposit that can be slashed if it fails to supply the promised capital. They will then redeem the acquired HYB units through the issuer's standard T+3 process, keeping the auction discount as compensation for providing immediate liquidity.
The integration is intended to address the issue of settlement in tokenized assets used in lending. RedStone said that continuous and defensible pricing has remained a separate obstacle for tokenized assets, especially when the underlying portfolio lacks continuous public trading.