Risk, Limits, and Concentration Framework

attnCredit manages risk through policy-bounded underwriting plus deterministic servicing controls. The objective is controlled loss behavior under stress, not discretionary reaction.

1. Risk types

Cashflow risk Revenue declines, volatility shocks, or unstable fee continuity.
Concentration risk Overexposure to one borrower, source, or correlated cohort.
Control-integrity risk Routing changes, signer/config drift, or policy bypass attempts.
Liquidity risk Redemption and funding pressure at credit pool level.
Operational risk Execution delays, monitoring faults, or incident response failures.

2. Facility-level limits

Each facility is bounded by policy limits such as:

borrowing base from trailing collectable fees,
volatility and concentration haircuts,
utilization ceiling and mandatory paydown windows,
max outstanding and draw cadence constraints,
reserve and DSRA requirements where applicable.

3. Lane-level and portfolio limits

Pump lane
- lower borrower caps,
- tighter concentration bands,
- faster throttling and stricter freeze thresholds.
Settlement lane
- conservative concentration profile,
- stronger reporting/covenant expectations,
- slower but stricter governance-controlled parameter changes.

No early commingling: lane limits and credit pool accounting stay separate.

4. Deterministic control modes

4.1 Throttle mode

Activated when risk worsens but remains serviceable. Effects:

draw availability reduced,
sweep intensity increased,
step-up privileges suspended.

4.2 Freeze mode

Activated when risk exceeds safe operating range. Effects:

new draws blocked,
routing and sweeps continue,
operations constrained to servicing and cure actions.

4.3 Default/acceleration mode

Activated when cure conditions fail or severe events occur. Effects:

all eligible routed fees prioritize repayment,
policy-defined acceleration behavior applies,
recovery and resolution actions are logged and reported.

5. Trigger classes and governance

Trigger classes include:

fee drawdown and volatility shocks,
concentration breaches,
routing/signing integrity failures,
covenant breaches and unresolved exceptions.

Governance scope:

parameter bands and cap updates,
reserve policy,
lane-level risk budgets,
incident and drill standards.

6. LP impact model

Losses and recoveries are reflected at credit pool level.
attnUSD holders are exposed according to credit pool composition.
There is no implied principal guarantee.