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Rarity

Abstract​

Rarity introduces a market-first framework for tokenizing real-world assets where price is verified through liquidity, not external oracles. Each asset enters circulation through verifiable acquisition, constrained release, and continuous price discovery, ensuring that supply, price, and collateral integrity remain economically self-consistent.

The core problem is not tokenization—it's synchronization. When asset value, token supply, and market price drift apart, RWAs collapse into accounting fiction. Rarity's design keeps those three variables locked together through verifiable minting (proof of acquisition), programmatic issuance (controlled supply flow), and mark-to-truth recentering (price convergence).

The protocol transforms subjective trust into observable market behavior: verification replaces trust, market depth replaces oracles, and programmatic issuance replaces discretion.

Why now​

Tokenized treasuries proved the viability of on-chain RWAs, but they only address standardized, liquid instruments. Rarity tackles the harder class—rare, thinly traded, information-sensitive assets—where authenticity and valuation uncertainty dominate. This design space demands new mechanisms for truth and liquidity.

Traditional RWA protocols treat pricing as static (NAV feeds) or rely on central appraisers. This breaks composability and introduces one-way trust. Rarity instead enforces market alignment between real-world cost, on-chain price, and supply through verifiable mechanisms.

Introduction​

Rarity by Djin Labs is a Real-World Asset (RWA) platform that makes tokenized assets tradable, composable, and yield-bearing on-chain. The protocol transforms tangible or financial assets (luxury watches, collectibles, tokenized treasuries, or loan portfolios) into liquid on-chain representations that interact with DeFi primitives—AMMs, lending markets, and yield optimizers—while preserving authenticity, auditability, and compliance.

The initial focus is on rare, illiquid, and difficult-to-price assets (e.g., luxury watches), with an expansion path to other verticals (e.g., real-estate). At its core, Rarity bridges the gap between off-chain value and on-chain liquidity, enabling fractional ownership, 24/7 trading, and DeFi composability for assets that have historically been inaccessible or illiquid.

What is Rarity?​

Rarity is an on-chain financial system that standardizes pricing, trading, and risk across a suite of products: bootstrapping (Raredrop), spot trading (CL AMM), mark-to-truth auctions, lending, futures, and auctions. The design goal is straightforward: reuse the same unit of collateral across multiple functions, price risk from real executable liquidity rather than static tables or delayed oracles, and route system cashflows back to participants in a transparent, programmatic way.

"Better Yield" means capital efficiency—the same deposit can earn base yield while also securing lending, resting limit orders, or futures margin. "Better UX" means the mechanics are encoded in contracts and unified across products: the same depth-aware prices feed trading, LTVs, funding, and liquidations; the same guardrails and change-management apply everywhere.

Key features​

Bootstrapping (Raredrop)​

A controlled launch mechanism where rare assets become tradable on-chain. Issuers provide authenticated assets, complete documentation, and pass whitelisting checks. Tokens launch at acquisition value during a Raredrop period, then transition to permissionless trading when distribution and time thresholds are met.

Collections​

Two issuance models optimized for different asset classes:

  • Asset-backed token: fixed issuance per asset, ideal for equivalent items
  • Fund with variable issuance: NAV-based minting, ideal for heterogeneous portfolios

Minting​

The mechanism through which new tokens enter circulation as collections grow. After the initial Raredrop, new assets are acquired, authenticated, and tokenized, expanding supply while maintaining orderly price discovery and fairness for existing holders.

Two paths enable growth:

  • Issuer-acquired assets: issuer buys assets and mints tokens, offering 80%+ to public at acquisition price
  • Custodian-verified assets: external owners tokenize their assets, retaining ownership of minted tokens

Supply management mechanisms prevent disorderly market impact: hold periods create cooling-off buffers, release curves spread supply gradually, and open interest provides demand signals through limit orders. These mechanisms ensure transparent token creation that scales with acquisitions while preserving market stability.

Spot Trading (CL AMM)​

Concentrated liquidity automated market maker with depth-aware pricing, limit orders, and RWAP (reserve-weighted average price) tracking. Prices reflect executable liquidity, not just last prints.

Mark-to-Truth Auctions​

When market price deviates from fundamentals, mark-to-truth auctions converge price back to objective value. This ensures prices reflect real asset value while maintaining 24/7 tradability.

Lending​

Permissionless pair-based lending and permissioned cross-collateral pools. Borrowing power is size- and depth-aware (from spot trading windows) rather than fixed tables.

Futures​

Oracleless perpetual futures that use internal trading as the oracle. Leverage limits, liquidation sizing, and slippage guards are driven by TWAP/RWAP-family windows.

Protocol philosophy​

Rarity is built on core principles:

  • Authenticity and auditability first: complete documentation, transparent custody, verifiable provenance
  • Market-driven price discovery backstopped by fundamentals: spot pricing via AMM, with mark-to-truth auctions for price convergence
  • Composability with DeFi primitives: tokens interact seamlessly with AMMs, lending markets, and yield optimizers
  • Pragmatic trust where necessary: minimize and isolate trust requirements; use whitelisting for issuance, permissionless for trading

How it works​

The protocol follows a simple flow:

  1. Collection creation: issuer acquires authenticated assets, provides documentation, passes whitelisting
  2. Raredrop: tokens launch at acquisition value with controlled distribution
  3. Trading: seamless transition to permissionless spot trading on CL AMM
  4. Minting: collections grow organically as new assets are acquired and tokenized
  5. Composability: tokens become available for lending, futures, and other DeFi primitives

Throughout this lifecycle, mark-to-truth auctions ensure prices reflect real asset value, while depth-aware pricing from spot trading feeds into all downstream products.

Getting started​