Whitepaper Chapter
Reserve
Insurance capital, stress absorption, and liquidity buffering.
Reserve is Sagitta's capitalized insurance layer that protects depositor principal and absorbs shocks before losses propagate through the system.
1. Mandate
Reserve provides protocol-native insurance coverage and solvency buffering across market and execution stress conditions.
Its role is protective first and growth-enabling only when coverage health supports expansion.
2. Coverage Scope
- Allocation underperformance and realized loss buffering.
- Liquidity and settlement stress absorption.
- Protection continuity during governance or infrastructure disruption.
3. Composition and Capital Sources
Reserve capital can be composed from doctrine-approved role assets and replenishment pathways:
- Retained protocol performance flows.
- Designated reserve contributions.
- Recovery and replenishment routing from settlement outcomes.
4. Reserve Ratio Doctrine
- Coverage ratio thresholds gate allocation growth.
- Reserve health determines permissible risk posture.
- Reserve supremacy over optimization remains binding.
5. Loss Absorption Ordering
Loss handling follows deterministic ordering so reserve capital absorbs protocol-level downside before depositor principal impairment.
This is an explicit accountability path, not discretionary intervention.
6. Replenishment and Recovery
- Outcome-driven replenishment loops restore coverage over time.
- Protective posture remains active until recovery thresholds are met.
- Growth permissions reactivate only after solvency health is restored.
7. Continuity Integration
Reserve behavior is coordinated with Sagitta Continuity Engine for evacuation, substitution, and staged reconstitution.
Emergency states prioritize preservation and deterministic settlement integrity.
8. Summary
Reserve is Sagitta's insurance constitution in capital form.
It enforces solvency-first doctrine and keeps depositor protection ahead of optimization.
Need implementation support?
Use these chapter pages for local review, then contact Sagitta Labs for architecture and deployment guidance.
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