Overview

Payment for order flow is how Robinhood makes money: it routes your orders to a market maker, and the market maker keeps the spread. On Robinhood Chain the stocks are tokens and they trade in Uniswap pools, where the market maker is whoever has deposited liquidity. PFOF is a fund that deposits that liquidity, collects the fee on every trade that crosses it, and pays the fees to the people who hold $PFOF.

Three parts: the desk, an address that holds the fund's balances and positions; the agent, a keeper that tends the positions on three public rules; and the payout, a Friday transaction that pays holders in USDG and is listed on the ledger with its hash.

The pools

Robinhood's tokenized stocks trade against USDG and WETH in Uniswap V3 pools on Robinhood Chain. A pool charges a fixed fee tier on every trade (0.05%, 0.3%, 1%, or 0.01% on the stable pairs) and pays it to the liquidity that was in range when the trade happened. The desk page reads each pool's fee tier from the contract, its volume from DexScreener, and multiplies them: that is what every provider in the pool earned together in the period. It is arithmetic from two live reads, and the site labels it as arithmetic wherever it appears.

The desk starts with the pools where the flow is: SPCX against USDG and WETH, and USDG against WETH. Turnover (volume divided by liquidity) is the number that matters; a pool turning over its capital ten times a day pays the fee tier ten times over.

Positions

A position is a deposit into a pool within a price range. While the price is inside the range, the position is the market maker for that range and earns the fee; outside it, it earns nothing and holds only the asset that fell. The fund page lists every open position with its pool, its range, its value and the fees it has earned, all read from the chain. Until the first position is opened, it says there are none.

The agent

"Agent" on this site means a keeper script with a schedule and three rules, each of which is a transaction from the desk address that anyone can read:

  • Harvest hourly. Fees accrued in each position are collected to the desk every hour.
  • Recentre on exit. When the price leaves a position's range, the position is closed and reopened around the current price.
  • Follow the volume. Capital is weighted toward the pools that carried the most flow in the last 24 hours.

It is not a trader. It takes no view on direction and it has no key that can send the fund's assets anywhere except into and out of positions. Its log is the desk's transaction history.

Impermanent loss, in plain words

A liquidity position is always buying the asset that is falling and selling the one that is rising, because that is what it means to be the market maker. If the price of the stock trends a long way in one direction, the position ends up holding more of the loser, and its value is lower than if the fund had simply held the two assets. That gap is impermanent loss. Fees are what the position is paid for taking it.

On a pool that turns over ten times a day, the fees usually outweigh the drift. On a quiet week where the price trends, they do not, and the NAV falls. The fund page shows the NAV every minute so you can see which is happening. This site will never print a yield figure, because the number depends on tomorrow's volume and tomorrow's price, and nobody has either.

Fees and the payout

  • Position fees: harvested hourly to the desk. Paid to holders every Friday at 20:00 UTC, in USDG, pro rata to a snapshot of $PFOF balances taken at the same time.
  • Creator fees on $PFOF trades (1% creator tax, 2% in total with Pons's own 1% on the curve): 50% to holders in the same Friday payment, 30% into new positions, 20% to the team.
  • Minimum: a payout happens when there is at least $25 to pay; otherwise it rolls into the next Friday and the ledger says so.
  • The ledger on the fund page lists every payment with its transaction hash. Until the first one, it is empty and says so.

If any of these terms change, the change is posted here and on X before it takes effect.

What $PFOF does

Holding it is the only way to receive the Friday payment. The snapshot is of balances held, never spent; buying and selling within the week does not change what a wallet is owed at the snapshot beyond what it holds at that moment. Half the creator fees on its own trading go back to the holders, so its volume pays its holders too.

Failure modes

  • The desk is an address in v1. The positions and balances are readable by anyone, but the fund's safety is the safety of one key until the vault contract ships. It is roadmap item one and it is said here so nobody has to discover it.
  • Impermanent loss can make the NAV fall while fees are still being paid. See above.
  • A pool can go quiet. The desk follows volume; if SPCX stops trading, the capital moves. If the chain stops trading, there is nothing to earn and the Friday payment is smaller or skipped, and the ledger shows it.
  • Robinhood's stock tokens are upgradeable contracts with pause and admin functions held by the issuer. A paused token is a position that cannot move until it unpauses.
  • The keeper can go down. Positions keep earning while in range; they stop earning when the price leaves the range and nobody recentres. The fund page shows the last time the agent acted.

Roadmap

  • nowThe desk address, the live pool reads, the fund page, the ledger, the terms. This site.
  • nextFirst positions in SPCX/USDG and USDG/WETH, opened from the desk, visible on the fund page with their ranges.
  • nextThe agent on a schedule, with its actions listed on the fund page.
  • buildingA vault contract that holds the positions with a keeper role that cannot withdraw, replacing the address.
  • buildingA distributor contract for the Friday payment, so the payout is a contract call, not a transfer someone has to remember.
  • openDividends: the stock tokens the desk holds pay dividends as balance increases; whether to pay them out or fold them into positions is decided in public, before it happens.
  • will not doPublish an APY. Provide liquidity to pools whose fees do not go to providers. Take a directional position with the fund.

PFOF is not affiliated with Robinhood. Tokenized stocks are issued by Robinhood and carry the full downside of the share; what you may hold where you live is yours to know. Liquidity positions can lose value. $PFOF is a token on a public chain; the Friday payment is a distribution of fees the fund earned, made pro rata to a public snapshot, and the terms above are the whole of what is promised. Nothing on this site is investment advice, and nothing on it is a forecast.