Risk Management & Compliance

Safeguarding the PST Ecosystem with Proactive Security and Credit Risk Strategies

PreviousGovernance & Token Economics NextRoadmap & Future Outlook

Last updated 6 hours ago

Risk Management & Compliance

Safeguarding the PST Ecosystem with Proactive Security and Credit Risk Strategies

Overview of Risk Management Strategy
1. PST protocol manages two primary risk categories:
  1. Credit Risk: The potential failure of e-shops to meet revenue targets.
  2. Platform Security Risks: Smart contract vulnerabilities, systemic liquidity issues, and governance risks.
Credit Risk Mitigation
1. Performance-Linked Stake: Every merchant listing is backed by a locked 15% of market cap in , ensuring incentive alignment.
2. Risk Analytics: Leverages API-driven financial data from 20,000+ e-commerce merchants to assess underwriting quality.
3. Revenue Interception Model: PST’s smart contracts directly enforce a 10% gross revenue share, preventing underreporting.
Platform Security & Smart Contract Protections
1. Audited Smart Contracts: All protocol contracts undergo independent security audits.
2. Multi-Sig & Governance Security: Critical treasury decisions require approval.
3. Regulatory Insurance Protection: PST holders benefit from regulated exchange partner insurance mechanisms in jurisdictions where applicable.
Price Stabilising Mechanism

Market sentiment can sometimes lead to irrational fluctuations in token prices, deviating from their fair value. To maintain price stability and respond to such market behavior, PST implements the following strategies through the ALAR mechanism:

Addressing Overselling Pressure (Price Support): When irrational selling occurs in the market, causing the token's valuation to fall below a Price-to-Earnings (PE) ratio of 8 (indicating potential undervaluation), will proactively buy back tokens. This action aims to provide price support by injecting purchasing power and reducing the number of tokens circulating in the market, thereby preventing further irrational declines and guiding the price back towards a reasonable valuation.
Addressing Overbuying Pressure (Price Regulation): Conversely, when irrational exuberance occurs in the market, causing the token's valuation to exceed a PE ratio of 15 (indicating potential overvaluation), ALAR will sell tokens. This action, by increasing the token supply in the market, aims to curb irrational market overheating, encourage the price to correct to a more sustainable level, and thus prevent potential bubble risks.

PreviousGovernance & Token Economics NextRoadmap & Future Outlook

Last updated 6 hours ago

Overview of Risk Management Strategy
1. PST protocol manages two primary risk categories:
  1. Credit Risk: The potential failure of e-shops to meet revenue targets.
  2. Platform Security Risks: Smart contract vulnerabilities, systemic liquidity issues, and governance risks.
Credit Risk Mitigation
1. Performance-Linked Stake: Every merchant listing is backed by a locked 15% of market cap in , ensuring incentive alignment.
2. Risk Analytics: Leverages API-driven financial data from 20,000+ e-commerce merchants to assess underwriting quality.
3. Revenue Interception Model: PST’s smart contracts directly enforce a 10% gross revenue share, preventing underreporting.
Platform Security & Smart Contract Protections
1. Audited Smart Contracts: All protocol contracts undergo independent security audits.
2. Multi-Sig & Governance Security: Critical treasury decisions require approval.
3. Regulatory Insurance Protection: PST holders benefit from regulated exchange partner insurance mechanisms in jurisdictions where applicable.
Price Stabilising Mechanism

Addressing Overselling Pressure (Price Support): When irrational selling occurs in the market, causing the token's valuation to fall below a Price-to-Earnings (PE) ratio of 8 (indicating potential undervaluation), will proactively buy back tokens. This action aims to provide price support by injecting purchasing power and reducing the number of tokens circulating in the market, thereby preventing further irrational declines and guiding the price back towards a reasonable valuation.
Addressing Overbuying Pressure (Price Regulation): Conversely, when irrational exuberance occurs in the market, causing the token's valuation to exceed a PE ratio of 15 (indicating potential overvaluation), ALAR will sell tokens. This action, by increasing the token supply in the market, aims to curb irrational market overheating, encourage the price to correct to a more sustainable level, and thus prevent potential bubble risks.