Burn

Burning is how a user exits, either fully or partially. The user specifies which LPGOLD position they want to close and what percentage of it (anywhere from 1% to 100%) they wish to redeem. Because PGUSD and LPGOLD were created together as a matched pair, redeeming requires the user to hand back a proportional quantity of PGUSD alongside the LPGOLD — the protocol needs both sides to release the underlying collateral cleanly.

The protocol fetches the current oracle price, calculates how much collateral the position is worth at that price, deducts any interest accrued from holding the leveraged position, and releases the net amount of collateral directly to the user's wallet. The corresponding S and L tokens are burned and cease to exist. Partial burns are fully supported, so a user can wind down a position in stages rather than all at once, giving them fine-grained control over how quickly they exit.