A fund token has a market price and a share of treasury backing. They are related economically, but they are not the same number.

Three numbers to keep separate

• Market price: what buyers and sellers exchange one fund token for.
• Fund value: the estimated value of the treasury's backing assets, excluding any of the fund's own tokens it holds, using available asset prices. Revenue waiting in routing or strategy contracts is not yet a treasury holding.
• Backing per token: that value divided by the effective fund-token supply, including accrued mining emissions that have not yet been minted.

An estimated value requires complete holdings and reliable prices. Missing prices are unknown value, not zero. The treasury itself pays out token quantities; it does not use a dollar NAV oracle to promise a cash payout.

How demand can help build backing

The economic hypothesis is:

1. A higher market price for the fund token can make earning new fund tokens more attractive.
2. Miners may then be willing to pay more USDG to take over the Mine. That willingness also depends on expected tenure, future prices and the next takeover payment.
3. Part of the actual takeover payment, after the outgoing miner's share and fees, reaches the revenue router.
4. Allocations direct revenue to strategies. Their auctions exchange USDG for chosen assets, with the treasury receiving the asset payment less any configured allocation rewards.
5. Those received assets add to the treasury's backing balances.

The payment and settlement steps are contract mechanics. The connection between market price and what miners choose to pay is a behavioral assumption, not an automatic rule. Routing can wait for live allocations or sufficient balances; auctions require settlement. A higher trading price alone transfers no assets into the treasury.

More assets does not always mean more backing per token

Mining also increases effective supply. Consider an illustrative fund with $100,000 of backing and 100,000 effective tokens: backing is $1 per token.

Each row starts from the same initial fund. These are arithmetic examples, not forecasts. They assume unchanged prices for assets already held, no withdrawals and no other supply changes. Net assets means what actually arrives after allocations and rewards, not the gross mining payment.

For that simplified case, backing per token rises only when the percentage increase in fund value exceeds the percentage increase in effective supply. Asset price declines can reduce backing even while new assets accumulate.

Withdrawal and the market-price gap

Burning fund tokens returns a proportional share of each listed treasury token, based on effective supply at execution. Any asset left off the list forfeits its share for the tokens burned. Token behavior, gas, rounding and the value obtainable by selling received assets all affect the practical result.

Withdrawal provides access to underlying assets. It does not guarantee that the market price equals estimated backing, remove every premium or discount, or return the holder's original purchase price. GlazeCorp does not offer a general deposit-the-basket-and-mint path at NAV; mining is its ongoing issuance mechanism. Protocols with both basket issuance and redemption have a different arbitrage mechanism.

For example, Reserve documents NAV-based issuance and underlying redemption, while Index Coop documents underlying-asset redemptions. Backing and redemption are therefore not exclusive to GlazeCorp. Its distinction is how mining revenue, allocation and auctions build that backing over time.

Read Mining, Revenue routing, Auctions and Withdrawal for the exact mechanics.