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Protocol economics / $CSL & the Burn

$CSL & the Burn

$CSL is collateral you can trade with, and a supply that shrinks every time somebody gets liquidated. No emissions, no farming - the burn is paid for by real volume.

Launch status

Live$CSL: 0x664f813ba5568966b8c7aaa03ef2218658a57777 on Robinhood Chain. Trust no other source - verify against @csldotfun.

The burn

CSL has no order book. The Vault is the counterparty to every trade - it pays your profits and it collects your losses. When a position is liquidated, the Vault does not keep all of the forfeited collateral:

Liquidated collateral
100%
What the trader forfeited when the mark hit their liquidation price
→
90% - Vault 10% - burned forever
Vault
90%
Backs the pool that pays every winning trader in full.
Burned
10%
Buys $CSL on the open market and sends it to a dead address. Supply gone.
Liquidation of $500 collateral
  → $450  to the Vault
  → $50   buys $CSL on the market and burns it

Who actually pays for the burn

Straight answer: the fee stream does. That 10% is money the Vault gives up, so it has to be earned back somewhere - and it is earned back through the 0.15% taker fee charged on every position opened, win or lose. Volume funds scarcity. That is the whole loop, and there is nothing else hiding behind it.

!
Anyone telling you a burn is free is selling something. Here it is priced into the fee, and the fee is published.

Trading with $CSL

Every skin market accepts two collateral assets:

USDG$CSL
Long / short any marketYesYes
LeverageUp to 20xUp to 20x, subject to a haircut
PnL settled inUSDG$CSL
Taker fee0.15%Discounted
On liquidation10% buys $CSL and burns it10% burned directly - no buyback needed

Prices, PnL and liquidations are always computed in dollars - a Dragon Lore's mark does not care what you posted as margin. Only the settlement asset changes.

i
A haircut applies to $CSL collateral: $100 of the token might back only $85 of margin. It reflects the token's volatility, and it stops a token drawdown from cascading into liquidations across the board.

The loop, end to end

Trader opens a position   → 0.15% taker fee → Vault
Trader wins               → Vault pays the profit in full
Trader loses / liquidated → 90% Vault · 10% BURNED
Collateral was $CSL       → burned directly
Collateral was USDG       → market-buys $CSL, then burns

There is no way to use the exchange without feeding the burn. Trading in $CSL simply removes the buyback step.

Why this design

  • Nothing is minted. No emissions, no farm, no APY out of thin air. Supply only falls.
  • The token has a job. It is margin. Demand comes from wanting to trade with it.
  • The burn scales with real activity, not with a schedule someone wrote in a spreadsheet.
  • Verifiable. Burn transactions land on Robinhood Chain. A burn you cannot open in an explorer is a slogan.

Risks

  • Volatile margin cuts both ways. If $CSL falls while your skin position is flat, the collateral behind it is worth less. The haircut softens this; it does not remove it.
  • A burn is not a price. Falling supply guarantees nothing about value. If volume dries up, so does the burn.
  • Trading with the token means you can lose the token - and the slice that burns is not coming back.

Read Risk Disclosure before posting $CSL as margin.

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