# Section A — Definitions & Accounting Glossary **Version:** v1.1 This section defines all terms, accounting constructs, and system concepts used throughout the LSteak and LSaaS documentation. All definitions in this section are normative. If a term is defined here, this definition prevails over any other usage. If a term is not defined here, it has no special protocol meaning beyond ordinary-language interpretation. Next: [Section B — Immutable Protocol Invariants](/lsteak-protocol-docs/technical-appendix/section-b-immutable-protocol-invariants.md) ### Contents * [A.1 Core assets & tokens](#a1-core-assets--tokens) * [A.2 Supply & accounting concepts](#a2-supply--accounting-concepts) * [A.3 Backing & valuation](#a3-backing--valuation) * [A.4 LSaaS structures](#a4-lsaas-structures) * [A.5 Yield & engines](#a5-yield--engines) * [A.6 Redemption & ratios](#a6-redemption--ratios) * [A.7 Transactions & flows](#a7-transactions--flows) * [A.8 Governance & activation](#a8-governance--activation) * [A.9 Scope terms](#a9-scope-terms) * [A.10 Interpretive rule](#a10-interpretive-rule) ### A.1 Core assets & tokens #### LSTEAK The primary protocol token representing a claim on backing held by the LSteak system, subject to protocol rules. LSTEAK is: * non-rebasing * emissionless * minted only via defined protocol mechanisms #### xl-LSTEAK A derivative token representing a proportional redemption claim against LSTEAK under the xl-LSTEAK redemption model. xl-LSTEAK: * does not rebase * redeems directly via dApp * does not directly alter LSteak backing #### Partner token A third-party token onboarded into LSaaS as an underlying asset for yield generation and deterministic redemption via an `xl-*` token. Examples include eSHARE, Plazm, or other approved assets. #### xl-Partner token A derivative token representing a redemption claim against partner-token holdings managed by LSaaS. Redemption behavior is governed by the Redemption Ratio (RR). ### A.2 Supply & accounting concepts #### Circulating supply The quantity of a token that is transferable and held outside protocol-restricted contracts. Circulating supply excludes: * LSaaS accounting balances * protocol-owned liquidity placeholders * non-redeemable accounting representations #### Effective supply The supply quantity used in economic calculations such as Backing Per Token (BPT). Effective supply equals: * total minted supply * minus non-circulating, non-redeemable accounting balances * minus protocol placeholders not representing redemption claims * minus pre-launch minted tokens explicitly designated for burn and removed via protocol burn mechanisms **Clarifications** * Pre-launch minted tokens (e.g. bootstrap bonuses): * are included in total minted supply at creation * are explicitly designated for burn * are removed from effective supply calculations as they are burned * These tokens: * do not represent persistent redemption claims * do not permanently inflate effective supply * Any LSTEAK minted via LSaaS flows is standard LSTEAK supply. * It counts toward effective supply. * It counts toward BPT. Effective supply reflects only active redemption claims. #### Accounting LSTEAK A non-circulating, non-redeemable accounting representation of LSTEAK used only for internal balancing (if present). LSaaS does not rely on accounting LSTEAK in the Queue-based architecture. Accounting LSTEAK: * is always valued at BPT * is excluded from circulating and effective supply * has no market presence * may be burned without economic effect #### Burn The permanent removal of a token from existence. Burns may be: * economic (affecting circulating or effective supply), or * accounting (affecting accounting-only balances) Unless explicitly stated otherwise, burns of accounting LSTEAK are accounting-only. ### A.3 Backing & valuation #### Backing The aggregate value of assets designated as backing for LSteak, held within protocol-controlled systems. Backing consists only of: * bond allocations * hedge allocations (LSteak Core only) Treasury balances are not backing. #### Backing Per Token (BPT) The value of backing allocated per unit of effective LSTEAK supply. Formally: `BPT = Total Backing ÷ Effective Supply` BPT is the reference value for: * minting * accounting LSTEAK valuation * guardrail enforcement #### Treasury skim A fixed percentage of value extracted from defined protocol flows and routed to the treasury. Unless otherwise stated, the treasury skim is `5%` fixed. ### A.4 LSaaS structures #### xl backing Partner tokens held inside the `xl-*` token contract as backing for deterministic redemption. #### VTL Queue Partner tokens held in the **VTL Queue**. Queued tokens are fully included in Redemption Ratio (RR) accounting. #### Value Transfer Loop (VTL) A fixed, contract-contained sequence that: * sells partner token → ETH * mints LSTEAK at core BPT (no treasury skim) * allocates capital into the Partner Yield Engine (PYE) at the core bond/hedge ratio * sells LSTEAK → partner token * deposits partner tokens into xl backing VTL execution is pre-simulated and atomic. #### Queue drip An internal process that periodically attempts a VTL using tokens from the Queue. Queue drip reduces `Q` and increases `B` without minting any `xl-*`. `Q + B` is unchanged, so RR is unchanged. ### A.5 Yield & engines #### Partner Yield Engine (PYE) A deterministic yield-generation system associated with an LSaaS partner. PYE: * receives value routed from LSaaS mechanisms * is allocated at the same bond/hedge ratio as the LSteak core * increases backing but does not mint tokens directly #### Yield Value generated by protocol-managed assets through yield-producing mechanisms. Yield may be allocated to: * backing growth * VTL Queue reduction * burns * treasury ### A.6 Redemption & ratios #### Redemption Ratio (RR) The ratio defining the redemption value of an xl-token relative to its underlying asset. For xl-partner tokens: `RR = (Partner tokens in Queue + partner tokens in xl-contract) ÷ xl-token supply` RR: * increases only via explicit RR mechanisms * is unaffected by movement between Queue and xl backing * is unaffected by accounting burns #### Best-execution redemption A routing process that selects the most favorable outcome between: * contract-based redemption, or * market-based execution xl-LSTEAK redemption is contract-only, because there is no xl market route in v1. ### A.7 Transactions & flows #### External entry A transaction initiated by a user depositing value into the protocol. #### Internal transaction A protocol-initiated action that does not originate from a user deposit. Internal transactions: * do not apply treasury skim * may use normalized allocations #### Value-transfer loop A controlled sequence of operations used to move value between protocol components. Value-transfer loops are subject to: * global BPT guardrails * execution limits #### Guardrail A hard, non-discretionary constraint that prevents protocol actions from exceeding defined economic or accounting limits. ### A.8 Governance & activation #### Dormant parameter A parameter that is defined but inactive until a specific system component is deployed and activated. Dormant parameters: * are immutable while dormant * cannot be partially enabled #### Activation The explicit governance action that enables dormant parameters by deploying and enabling the associated system component. ### A.9 Scope terms #### LSteak Core The base protocol deployed at initial launch, excluding LSaaS functionality. #### LSaaS (Liquid Staking as a Service) A post-launch extension framework that enables partner-token onboarding, deterministic `xl-*` issuance, and partner-specific yield engines. ### A.10 Interpretive rule If ambiguity exists between: * ordinary-language meaning, and * a definition in this section, the definition in this section prevails. *** Next: [Section B — Immutable Protocol Invariants](/lsteak-protocol-docs/technical-appendix/section-b-immutable-protocol-invariants.md) --- # Agent Instructions: Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. 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