House liquidity
The Kiln
Every trade on Blue Clay faces the Kiln. It started at zero and is fired only by realised trader losses: no deposits, no outside LPs.
Kiln balance—
Debt queue—Owed to winners while the Kiln is below zero
Paid to stakers—Cumulative, in USDC
Open interest—
Kiln balance since launch
Kiln above zero
Winning closes are paid in full from the Kiln. Losing closes refill it, and mint CLAY to the trader who lost.
Kiln below zero
Winners are paid what the Kiln holds and the rest joins the debt queue, paid in order from the next losses. CLAY mints up to 5× faster in this regime.
Kiln above the cap
Once the balance passes the staker cap, every further dollar the Kiln earns is distributed to staked CLAY.
Full mechanics in the Kiln documentation.