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Token Format

Energy Substantiation tokens are digital assets backed 1:1 by physical commodities.

Token Basics

Property Description
Blockchain Ethereum Mainnet
Standard ERC-20 (compatible with all Ethereum wallets)
Backing 1:1 by physical commodities
Carry Cost Zero
Transferable Yes, 24/7

Volumetric Energy Receipts (VER)

Each token is backed by a Volumetric Energy Receipt (VER) - a legal document representing ownership of physical energy.

What is a VER?

A VER represents an "undivided interest in commingled goods" - a recognized legal structure for commodity ownership. This is similar to how grain elevators or oil tank farms operate, where owners hold a share of a commingled pool rather than specific physical units.

  • True document of title - Legal ownership of underlying energy
  • Fungible ownership - Own a volume of energy, not specific molecules
  • Bankruptcy remote - Assets are protected if a supplier fails

Custody and Auditing

VERs are held by a qualified third-party custodian who provides:

  • Segregated custody - Token holder assets are held separately
  • Regular audits - Independent verification of backing
  • Real-time transparency - Backing levels are reported continuously
  • Physical verification - Custodian confirms commodity is in storage

The custodian ensures that for every token outstanding, there is corresponding physical energy backing it.

Energy Denomination

VERs are denominated in BTU (British Thermal Units) - a standard measure of energy content. This provides flexibility:

  • Different grades of the same commodity can back the same token
  • Energy content is consistent regardless of physical form
  • Enables cross-commodity products in the future

Each token type specifies how many BTUs back each token. See Available Tokens for specific conversion rates.

Reference Pricing

Token prices track spot commodity prices:

  • Daily reference price derived from liquid futures markets
  • Zero roll costs - No futures positions to maintain
  • Expiry handling - Protects against extreme volatility during contract expiry

Each token has its own pricing methodology based on the relevant commodity benchmark.

Fees

There is a small fee for minting (purchasing) tokens and for burning (redeeming) tokens. Holding tokens is free - there are no ongoing management fees or carry costs.

See Available Tokens for specific fee schedules for each token type.

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