Validator Basket
All properties within the Theopetra housing network are subject to a 1% yearly rent increase cap. This is great for residents because it allows them to build their savings over time, but how does the protocol sustain itself in the long run?
An offset is needed to compensate for the diminished returns due to the rent cap, so in addition to real estate the protocol also holds a basket of validator assets, such as liquid staking tokens. A portion of incoming funding is allocated to this validator basket, with the remainder split with operational expenses. The resulting split is 90% towards new properties, 1-5% to operational expenses, and 5-9% to the validator basket. The ratio between the two variable allocations is set at the discretion of the Theopetra Core Team, to be handed off during the decentralization process.
Yield generated from the validator basket is sent to the property managers to supplement rent, cover expenses, with the remainder exchanged for $THEO and converted to $YIMBY.
Theopetra relies on Ethereum as part of its infrastructural requirements, using it as a neutral settlement layer. Due to this pre-existing exposure, and status as the largest validator asset, it has been selected as the first asset in the basket. Accepted types of liquid staking tokens will be adjusted according to their market size, centralization risk, and diversity. Following the BORG restructuring, protocol controlled validators will be used to better support public blockchain infrastructure and contribute to decentralization. Currently this includes:
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