“If the claim trades at 25 cents, you can sell your claim for $25,000 in stablecoin and withdraw. We will also have a backstop, which will be a large fund that wants to buy below the market,” Davies added. “The fund can bid for the entire tranche at, let’s say, 20 cents in this case, they can hold it there for a month, then every month adjust it within a range.”


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