Glossary

A complete reference of technical and financial terms used in the Stove Protocol ecosystem.

Core Components of Stove Protocol

RFQ Settlement (Request-for-Quote System) The off-chain order and on-chain settlement mechanism at the heart of Stove Protocol. Users (makers) sign EIP-712 orders off-chain, and authorized takers execute them on-chain — minting or burning StockTokens 1:1 with real equities.

StockToken An ERC-20 token (0 decimals) representing one integer share of a listed stock. Each StockToken is backed 1:1 by real shares held by licensed custodians.

StockTokenFactory A deterministic CREATE2 contract deployer that generates StockTokens based on each (ticker, exchange) pair, guaranteeing unique and predictable addresses.

StockTokenManager The central coordination contract for token lifecycle and corporate actions. Responsible for minting and burning tokens, triggering stock events, managing fees, and interacting with the Vault.

Vault A secure custody contract used to store and distribute funds related to dividends, fractional compensations, or delisting payouts. Only the StockTokenManager can withdraw from the Vault.

Corporate Actions On-chain representations of real-world stock events such as stock splits, reverse splits, dividends, ticker changes, and delistings.

Permit2 A gasless approval mechanism integrated for user convenience and security, based on the Uniswap Permit2 standard.

Timelock A governance delay mechanism that enforces a waiting period before sensitive parameter updates or upgrades can be executed.

General DeFi & Blockchain Terms

DeFi (Decentralized Finance) Blockchain-based financial services that operate without traditional intermediaries such as banks or brokers.

APY (Annual Percentage Yield) The yearly interest rate including the effects of compounding, commonly used to express yield in DeFi.

APR (Annual Percentage Rate) The simple annualized interest rate without compounding, typically used for comparison between financial products.

DEX (Decentralized Exchange) An automated trading protocol (e.g., Uniswap, PancakeSwap) where users can swap tokens without intermediaries.

Oracle An external data provider (such as Chainlink or Pyth) that supplies real-time asset prices to smart contracts.

Gas Fees Transaction costs paid to blockchain validators for executing operations; vary by network congestion.

TVL (Total Value Locked) The total amount of assets deposited into a protocol — a common metric for measuring protocol scale.

Smart Contract Self-executing code deployed on the blockchain that autonomously performs actions according to predefined rules.

Tokenization & Market Concepts

Tokenized Stocks Blockchain-based representations of traditional listed equities issued at a 1:1 ratio, enabling 24/7 global access and composability in DeFi.

Custodian A licensed brokerage or regulated entity responsible for holding real stocks and maintaining the 1:1 backing of StockTokens.

Mint The process of creating new StockTokens when a user buys tokenized shares through an RFQ-based order.

Redeem The process of burning StockTokens to unlock and withdraw the corresponding real-world stocks or stablecoins.

Dividend Periodic distribution of earnings to token holders, automatically calculated and disbursed through the Vault system.

Stock Split / Reverse Split Corporate actions that proportionally increase or decrease token quantities to mirror changes in underlying share counts.

Ticker Change An update to the symbol (e.g., AAPL → APPL) for a tokenized stock; handled automatically by the StockTokenManager.

Delisting The retirement of a tokenized stock when the underlying equity is removed from a traditional exchange; compensation is distributed to holders.

Corporate Action Fee A configurable fee (fixed or percentage-based) collected during specific corporate actions such as dividends or delistings.

Security & Governance

ReentrancyGuard A protection mechanism preventing functions from being called repeatedly before completion — mitigating reentrancy attacks.

AccessControl A role-based permission system defining privileges for Owner, Operator, and Taker roles within the protocol.

Upgradeability (UUPS) A contract design pattern allowing logic upgrades while preserving existing data storage and user balances.

Custom Errors Solidity 0.8+ error definitions that improve gas efficiency and debugging clarity compared to revert strings.

Audit A third-party security review performed by specialized firms (e.g., Trail of Bits, OpenZeppelin) to identify vulnerabilities before deployment.

Bug Bounty A community incentive program rewarding users who responsibly report security vulnerabilities.

Multisig (Multi-Signature Wallet) A secure wallet requiring multiple authorized signatures to execute transactions — used for governance and fund control.

Timelock Delay A built-in safeguard that ensures transparency and reaction time before any administrative changes are enacted.

Additional Market & Risk Terms

Wallet A software or hardware tool for managing blockchain assets and signing transactions (e.g., MetaMask, Rabby, Ledger).

Web3 The next evolution of the internet built on decentralized blockchain technology.

Utilization Rate The ratio of borrowed assets to total supplied assets — a key driver for interest rate adjustments in DeFi markets.

LTV (Loan-to-Value Ratio) The ratio of borrowed amount to collateral value; determines liquidation thresholds and borrowing capacity.

Slippage The difference between the expected and executed price of a trade, often occurring in markets with low liquidity.

Volatility The degree of price fluctuation in an asset over time, a critical factor in assessing risk and liquidation safety.

Oracle Price Feed A continuous real-time data stream from oracle providers used to determine asset valuations in RFQ and collateral calculations.

Reserve Factor A percentage of protocol revenue set aside in reserves for maintenance, insurance, or development.

Health Factor A numeric indicator representing the safety margin of a leveraged or collateralized position; values below 1.0 trigger liquidation.

💡 Note Stove Protocol aims to serve as open, verifiable, and sustainable financial infrastructure for the tokenized asset era. If a term is missing or unclear, contributors are welcome to propose new entries via [email protected].