Settlement Rules
What will happen at TGE Time?
1. Ideal Case
Definition: Everything works as expected at TGE.
Conditions (all must be true)
Token live on Agreed Chain The token contract is deployed on the chain that the listing specified, and that’s the chain both Seller and Buyer are trading/expecting delivery on.
Claimable at settlement start As soon as settlement begins, the Seller can claim/unwrap/unlock the tokens (no portal downtime, no issuer pause).
Easy route to deliver If the token originated elsewhere, there’s a supported, healthy bridge/route to the Agreed Chain with normal fees and confirmations (no special setup, no custom SMC needed).
What users should expect
Timer: 4-hour settlement window starts at Activation.
Action: Seller sends tokens directly to Buyer’s address on the Agreed Chain and posts the tx hash.
Result: Status moves to Settled once confirmations clear.
Important Notes: In Pre-Market, the Seller may choose to either Settle (deliver tokens) or Default (do not deliver and lose collaterals). This option exists because TGE prices can move sharply; pre-market is price discovery, not a guaranteed forward.
2. Cross-Chain Settlement
Cross-Chain Settlement allows an order to be listed on one blockchain while the underlying asset originates from another blockchain.
Listing Chain: The chain where the order is created and settled.
TGE Chain: The chain where the original token exists.
This mechanism enables shared liquidity across chains while keeping assets native and fully backed. All cross-chain operations are powered by LayerZero. No synthetic value is created. Every wrapped token is backed 1:1 by locked assets.
3. Risk Disclosures
In the event Whales Market cancels a pre-market trade, users are expected to understand and accept the associated risks and obligations.
3.1 Buyer risks
Case #1: Pre-market works perfectly without any issue at settlement
If the TGE price is way too high than the token price you bought, a seller may default the order, and thus give up collateral to the buyer.
Example:
Pre-market fill for Token A at $0.50.
TGE prints around $1.50.
Seller Defaults to capture the higher profits.
Buyer receives their collateral plus the Seller’s collateral; no tokens are delivered.
Important Notes: If the settlement time is passed, the buyer has the right to cancel the order. If the buyers don’t cancel, the seller still has the right to settle tokens at any time until the order is either settled or cancelled.
Case #2: If Pre-Market is cancelled
The buyer will receive their collateral back.
3.2 Seller risks
Case #1: Pre-market works perfectly without any issue at settlement
If a seller fails to settle within the settlement timeframe, it will grant buyers the right to cancel.
Case #2: If Pre-Market is cancelled
The seller will get their collateral back and forfeit any profits from selling tokens on pre-market
3.3 Resell Buyer
Case #1: Pre-market works perfectly without any issue at settlement
Resell buyers are a riskier party than others in a pre-market.
Once you buy a resell order, you will inherit the original buyer’s collateral and obligations.
If you buy a resell order at a high price (e.g 80% more than the original price) and TGE price is higher than the resell price, The seller has an option to default the order and thus the buyer might not get any profits from the trade
Case #2: If Pre-Market is cancelled
The buyer will incur a loss in this situation.
For example:
user A sells 1,000 tokens A for $0.5 per token => $500 collateral locked in contract
Original buyer B buys 1,000 tokens at $0.5 per token A => $500 collateral locked in contract.
user C buys a 1,000 tokens resell order at $0.9 per token A => Original Buyer B receives $900 instantly.
If pre-market is cancelled, user A receives $500 collateral back and user C ONLY receives the original buyer B’s $500 collateral => User C incurs a loss of $400.
Wait until TGE: Neither sellers nor buyers can settle or cancel orders before the Token Generation Event (TGE).
The 4-hour countdown starts only when the project’s token is officially listed on markets.
FAQ
When does the settlement phase happen, and how long does it last?
The settlement phase begins when a project's token is officially listed on centralized (CEXs) or decentralized (DEXs) exchanges. This phase lasts for 4 hours
What happens if a Seller doesn't settle on time?
If the seller misses the 4-hour settlement deadline, their Order will become OVERDUE. The seller will lose their collateral, and it will be transferred to the buyer.
As a Buyer, what can I do if a seller doesn't settle?
If the seller misses the 4-hour settlement deadline, their Order will become OVERDUE. The seller will lose their collateral, and it will be transferred to the buyer.
Last updated