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Let's say I have 5 contributors to a pool of a smart contract. They all contributed 1 ether. The smart contract lost 2 ether, and now I want to transfer back the remaining 3 ether to the 5 contributors but also refund the delta of the loss.

How can I mathematically define to refund the delta? do I need to use modulus?

  • I believe the question is a bit abstract. In the end, do you want do refund 5 ETH to the contributors (which is exactly what they deposited collectively)? The "delta" you refer to equals 2 in your example? – Daniel Portugal Jul 18 at 16:48
  • exactly. Somehow 2 ether (the delta) was lost from the pool; the contributors all lost 0.25 ether individually from their initial contribution. I want to mathematically calculate this 0.25 ether individual loss and add it to the transfer. – NowsyMe Jul 18 at 16:54
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You didn't explain the periodicity and other details.

  1. Is the membership fixed or do they come and go?
  2. Does the contract continue to gain/lose on operations, or is this a wrap-up and final settlement?

In the simplest case I can think of, all members join (deposit), then things happen, then you establish the entitlement of each member at a point in time and stop gains/losses. You let them each withdraw 3/5 (0.6) of an ether.

A more fluid arrangement would involve the use of tokens. You sell tokens to yourself for 1 ether to bootstrap things with a "par" value of 1 ether/token. Then the contract offers to buy (redemption) or sell (issuance) at a price set by a formula. Mintable and burnable token design allows for as many tokens as people want to buy and destroys them on redemption.

The price would be

ether on hand/tokens in circulation

So, with 3 ether on hand and 5 tokens in circulation, the price would be 3/5 (0.6) ether for 1 token. Someone will redeem a token for 3/5 (0.6) ether, leaving 2.4 ether on hand and 4 tokens outstanding. Someone else sells and they get 1/4 of 2.4 which is also 0.6 (as it should be).

Members would join and leave as/when they wish (by purchasing and redeeming tokens). The operations and subsequent gains/losses would be continuous with no need for cut-off times in the calculation. A caveat would be that the world of off-chain assets is not so tidy.

Not legal advice. Not investment advice. Check the math. Your mileage may vary. Void where prohibited.

  • thanks for the in-depth answer, I will edit my question to be more detailed apparently I'm not being verbose enough in my example – NowsyMe Jul 18 at 21:25

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