Barrier
Definition
Section titled “Definition”The barrier is a price level below s0, expressed in basis points: barrier = s0 × barrierBps / 1e4. The specification default is barrierBps = 6_500, so a note struck at 180.00 has a barrier of 117.00.
Two roles of the barrier
Section titled “Two roles of the barrier”The barrier does two different jobs depending on when it is observed.
| Observation | Observed price ≥ barrier | Observed price < barrier |
|---|---|---|
observations[1..last-1] (intermediate) | Coupon paid for that observation. If also ≥ autocall level, series autocalls. | No coupon for that observation. Series continues. No other consequence. |
observations[last] (maturity) | Principal repaid in USDG plus final coupon. Status Matured, cash settlement. | No coupon. Principal repaid in Stock Tokens at s0. Status Matured, physical settlement. |
A breach at an intermediate observation is therefore not a knock-in. It only suspends that observation’s coupon. Knock-in is judged once, at the final observation. This is a discrete (European-style) barrier: prices between observations are irrelevant, including weekend and after-hours prints.
Comparison operator
Section titled “Comparison operator”fact The comparison is inclusive: price >= barrier holds. Equality at 1e8 precision counts as the barrier holding. Similarly price >= autocall triggers autocall.
Barrier in the app
Section titled “Barrier in the app”The barrier visual language is fixed by the brand system: a horizontal hairline at the barrier level, the price path above in the primary text colour, the region below the barrier tinted in the “down” colour at 8% alpha, observation dates as small ticks, and the autocall level as a dashed brass hairline.
Choosing a barrier
Section titled “Choosing a barrier”Lower barriers reduce knock-in probability and reduce the coupon the market will clear at. In traditional single-stock autocallables, barriers of 60% to 70% with coupons of 15% to 30% p.a. are typical for high-volatility names (ETFGI). The protocol does not restrict barrierBps beyond requiring barrierBps < autocallBps; series creators (governance) choose it.
Barrier and corporate actions
Section titled “Barrier and corporate actions”fact Stock Token feeds already include the ERC-8056 uiMultiplier, which folds splits and reinvested dividends into the quoted price (Robinhood building guide). Because both s0 and every later observation are read from the same feed, the barrier needs no manual adjustment for corporate actions. The protocol never re-applies the multiplier.