Redeeming QNT
The QNT redemption process for collateral assets.
Redeeming QNT is one of the core stability mechanisms of the Quintes Protocol.
Unlike a simple withdrawal, redemption actively maintains the protocol’s solvency and price integrity by balancing QNT supply and collateral exposure across all vaults.
Overview
Any QNT holder can redeem their tokens directly with the protocol at any time. When redemptions occur, the system automatically adjusts collateral and debt positions to ensure that QNT remains pegged to the Quintes Index.
This mechanism provides:
A hard price floor for QNT.
Automatic removal of risky or undercollateralized vaults.
Continuous system-wide stability.
Step-by-Step Guide
1. Go to the Redeem Page
Click the “Redeem” tab on the menu bar.
2. Connect Your Wallet
Click the “Connect Wallet” button (top right corner of the Quintes app).
Select the wallet your QNT exists in.
3. Enter Redeem Amount
Enter how much QNT you'd like to redeem.
Below, you should see the redemption price for redeeming QNT.
4. Confirm and Redeem
Click “Redeem QNT” to initiate the transaction.
Your wallet will prompt you to confirm. Once approved, collateral assets will be sent to your connected wallet.
How Redemption Works
Redemption Initiation The user sends their QNT (e.g., $1,000 worth) to the Quintes protocol’s redemption contract.
Vault Selection The system automatically identifies the riskiest vault — the one with the lowest collateralization ratio to fulfill the redemption. This ensures that unstable vaults are prioritized for partial unwinding.
Collateral Seizure and QNT Burn The protocol seizes an equivalent amount of collateral (e.g., $1,000 worth of ETH) from the identified vault. Simultaneously, it burns the same amount of QNT from the redeemer’s balance, permanently removing it from circulation.
Redemption Settlement The redeemer receives the collateral (minus a small, dynamic redemption fee). The vault owner’s debt is reduced by the same amount of QNT burned, keeping the system balanced.
Here's an example:
A user redeems 1,000 QNT at the current index price of $1 per QNT.
The system selects the most undercollateralized vault and removes $1,000 worth of ETH from it.
The redeemer receives the ETH (minus the fee).
The vault owner’s debt is reduced by 1,000 QNT, but they lose that portion of their collateral.
This process improves system health by incentivizing vault owners to maintain strong collateral positions — avoiding redemptions against their vaults.
How Redemption Works
Redeemer
Gains collateral
Exchanges QNT for equivalent collateral at target price (minus fee).
Vault Owner
Loses collateral, reduces debt
Their vault becomes safer but sacrifices upside potential.
Protocol
Gains stability
Risky debt positions are automatically reduced, supporting the peg.
Purpose of Redemption
Redemption serves three main goals within Quintes:
Peg Stability Ensures that QNT’s market value remains tightly aligned with the Quintes Index.
System Solvency Continuously removes undercollateralized positions, strengthening overall protocol health.
User Incentives Encourages minters to maintain safe Health Factors (HF) and collateral ratios to avoid partial vault liquidation via redemptions.
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