How it works

From a report to a basket

1. A report is filed. A member files a Periodic Transaction Report with the House Clerk.
2. Keepers copy each line. One keeper reads the PDF and posts each stock line on Solana: the member's Bioguide ID, the stock, buy or sale, the reported range, the trade date, the filing date, the year and number of the PDF on the Clerk's site, and the PDF's SHA-256 hash. A second keeper reads the same PDF on its own and confirms the line only if it reads exactly the same thing. Two of the three keepers must agree before the line counts.
3. Anyone moves the line into baskets. A buy becomes a holding of that member's basket, and of the Top 5 basket while the member holds a seat, from the next close until 90 days after the filing date. A sale ends that member's earlier buys of the same stock at the next close.

A buy of a stock that has never had an accepted close is skipped, because one holding without prices would stop the whole basket from settling.

Follow and Fade

Every basket has two sides, both holding USDC.

• Follow gains when the basket beats its benchmark and loses when it falls short. For the Top 5 and member baskets the benchmark is the S&P 500, so only the part of the move that beats or trails the market counts. The market baskets (gold, silver, copper, oil, natural gas, Treasuries, real estate) have no benchmark: each moves with its ETF's close.
• Fade takes the other side. It gains what Follow loses and collects a fee from Follow every day: 2% a year, plus up to 18% more as Follow's money approaches Fade's size.

Follow is never exposed beyond what Fade holds. If Follow is larger, only a part of it equal to Fade moves, and the rest waits as cash.

Once a day, at the close

The baskets settle once a day, after the official Nasdaq close is posted by the keepers and a 30 minute waiting window has passed. Anyone can call the settlement. In order, it:

1. moves money between the sides by the day's move of the basket (the average move of its open buys, minus the S&P 500's move for member and Top 5 baskets);
2. moves the day's fee from Follow to Fade;
3. fills the day's requests at the new share prices: withdrawals first, then Fade deposits, then Follow deposits, only up to Fade's size, with the rest returned.

Requests

Putting money in and taking it out are requests. A request waits for the next settlement, and you can cancel it until then. After the settlement you claim it: shares (and any part that did not fit) for a deposit, USDC for a withdrawal. Each request takes its share of that day's totals, rounded down, so the claims can never add up to more than the vault holds.

The table and the Top 5

Each reported buy is scored once: from the first close on or after its filing day to the first close on or after 90 days later, the stock's move minus the S&P 500's move. A member's record counts the scored buys, how many beat the S&P 500, and the sum of how much. Members with at least 10 scored buys are ranked by the share that beat the S&P 500, then by the average.

The Top 5 has five seats. Anyone can seat a member with at least 10 scored buys in an empty seat, or in place of the weakest seat when the member ranks higher. A member who loses a seat leaves the Top 5 basket at the next close.

History before launch

So that the table is not empty on day one, the keepers post the past year from history, one total per member: how many of the member's buys from the year before launch were scored, how many beat the S&P 500, and the sum of how much, each computed from Nasdaq's closes the same way the program scores a live buy. Two keepers must post the same three numbers, and a member's history goes in once.

Only the last 100 days of reports are posted line by line, because only those can still be in a basket. A buy filed before launch whose 90 days end after it is posted with its entry close and finished live. Once the operator closes the history phase, all of this is shut for good.

Next: Security and trust