1. The token
Each market is an ERC-20 that targets a fixed multiple of a stock's return. NVDA3L aims for 3x long NVDA, NVDA3S for 3x short. Its value per share (NAV) is denominated in ETH, and you can mint or redeem against the protocol at that NAV.
2. Pricing off the oracle
Instead of holding leveraged stock, the token tracks a geared index of the Chainlink price feed for that ticker. Because the stock is never swapped, there is no slippage and no dependence on a deep pool. That is what lets Moka list tickers whose on-chain liquidity is almost nothing.
3. Daily rebalance
A keeper updates each token's NAV index once per interval:
navIndex = navIndex × (1 + L × r)
where r is the oracle return since the last update and L is the leverage (+3 or -3). This resets exposure back to the target, which is what keeps leverage constant. The tradeoff is volatility decay: in choppy markets the token bleeds, in trends it compounds. These are conviction instruments, not buy-and-forget.
4. Where the payout comes from
Longs and shorts are natural counterparties. When 3x long open interest roughly equals 3x short, they fund each other and the protocol carries almost no risk. The leftover imbalance is warehoused by the liquidity pool, which takes the opposite side and is paid for it.
5. Funding and caps
The heavier side pays a periodic funding rate to the lighter side and to the pool, which pushes the book back toward balance. Net open interest is capped against pool size so the pool can always cover a maximum adverse move.
6. The wipeout floor
A 3x token cannot owe more than its collateral. On an extreme adverse move its NAV floors near zero and the market auto-deleverages. Nobody ends up in debt, and there is no per-user margin call.
7. Fees
Moka earns from a streaming management fee on assets, a small mint and redeem fee, and a share of funding routed to the pool. Simple, transparent, on-chain.