Bid Wall (NAV Protection)

The Bid Wall is NovaDAO's core investor protection mechanism. It creates a permanent buy-side order at the Net Asset Value (NAV) price, ensuring that token holders can always exit at a price backed by real treasury assets.

Note: The Bid Wall is not a market maker or a price peg. It is a treasury-backed floor that guarantees minimum redemption value for token holders.

How It Works

Treasury Funds the Wall

A portion of the ICO proceeds is allocated to the Bid Wall smart contract. These funds are held on-chain and are always visible to anyone.

NAV Price Is Calculated

The NAV price is computed as the total Bid Wall reserves divided by the circulating token supply. This price updates automatically as reserves and supply change.

Standing Buy Order

The Bid Wall contract maintains a permanent buy order at the NAV price. Any token holder can sell into this order at any time, receiving the NAV value for their tokens.

Tokens Are Burned

When tokens are sold into the Bid Wall, they are permanently burned. This reduces circulating supply and maintains the NAV price for remaining holders.

NAV Recalculates

After each redemption, the NAV is recalculated. Because both the reserves and the supply decrease proportionally, the NAV per token remains stable or increases for remaining holders.

How the Bid Wall Is Funded

The Bid Wall receives funding from multiple sources throughout the lifecycle of a project:

Bid Wall Reserve = ICO Allocation + Fee Revenue + Governance Deposits

Example: Initial Funding

Source	Amount (XLM)	% of Raise
ICO Proceeds Allocation	500,000	50%
Performance Package Reserve	100,000	10%
Protocol Fee Reserve	50,000	5%
Total Initial Bid Wall	650,000	65%

NAV Calculation

NAV = Total Bid Wall Reserves / Circulating Token Supply

Key Properties

Non-decreasing: The NAV per token can only stay the same or increase over time. Redemptions reduce both reserves and supply proportionally, while fee revenue adds to reserves without increasing supply.
Fully collateralized: Every token in circulation is backed by at least its NAV value in on-chain reserves. There is no fractional reserve.
Transparent: Both the reserve balance and the circulating supply are readable on-chain at any time. The NAV is a simple division, verifiable by anyone.
Instant settlement: Redemptions against the Bid Wall settle in a single transaction. There is no queue, no delay, and no counterparty risk.

Fees

A 1% fee is charged on all Bid Wall redemptions. This fee is retained in the Bid Wall reserves, which means it directly increases the NAV for remaining token holders.

Tip: The 1% redemption fee creates a small incentive to hold rather than redeem, while ensuring that each redemption slightly benefits remaining holders.

How to Use the Bid Wall

Connect Your Wallet

Connect your Freighter wallet to the NovaDAO application. Ensure you are on the Stellar mainnet (or testnet for testing).

Navigate to the Project

Find the project whose tokens you want to redeem. The current NAV price is displayed on the project dashboard.

Select "Redeem at NAV"

Click the Bid Wall redemption button. Enter the number of tokens you wish to redeem. The interface will show the exact amount you will receive after the 1% fee.

Confirm the Transaction

Review the transaction details in your Freighter wallet and approve it. The transaction will execute atomically on Soroban.

Receive Your Funds

The XLM proceeds are sent to your wallet in the same transaction. Your redeemed tokens are burned and removed from circulation.

Key Constraints

Constraint	Details
Minimum Redemption	100 tokens (prevents dust attacks)
Redemption Fee	1% (retained in Bid Wall reserves)
Settlement	Instant, single transaction
Reserve Asset	XLM (native Stellar asset)
Price Direction	NAV can only increase or stay flat, never decrease
Availability	24/7 — no downtime, no maintenance windows

Learn more about the sale process: The ICO