# Protocol Mechanics Unity’s mechanics are transparent and code-defined. Collateral supplied during minting is routed to strategy modules according to predefined logic. Examples include: #### Derivatives-Based Modules Long spot + short perpetual futures to dampen directional exposure while earning funding or basis spreads. > #### Underlying Derivatives > > Some modules use derivatives to reduce risk exposure. These may include: > > > USD-margined or coin-margined perpetual futures > > > Options structures > > > On-chain perpetual DEXs > > These tools help stabilize dollar-referenced behavior and enable access to certain yield streams. They are one part of a broader architecture. #### On-Chain Lending Supplying assets to vetted lending protocols with robust audit histories and deep liquidity. #### Liquidity Provisioning Systems Participating in markets designed with dollar-referenced payoff profiles. #### Structured Yield Modules Engaging with hedged vaults and structured opportunities engineered to remain liquid and observable. These modules are rules-driven and can be updated through governance and risk review as new opportunities or venues emerge. Performance flows through the system collectively; UTY represents protocol-defined behavior, not a pro-rata claim on a managed pool. --- # Agent Instructions: Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter: ``` GET https://xsy-1.gitbook.io/xsy-main/protocol-mechanics.md?ask= ``` The question should be specific, self-contained, and written in natural language. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.