For every FRT generated by VNX and remaining in circulation, VNX will hold an equivalent amount of reserve on behalf of Users (the “FRT Reserves”).” FRT is generated based on VNX Gold (VNXAU) which may be used by VNX to be replaced with an equivalent amount of assets.

In a nutshell the process looks as follows: a user (who has FRT Minting Agreement with VNX for the generation of FRT) requests FRT generation and provides VNX Gold in irregular custody to VNX. VNX uses VNX Gold to create the FRT reserve, generates FRT and transfers it to the user account on the Platform. Then in the process of the reserve management VNX replaces VNX Gold by the FRT referenced fiat currency held in the bank deposits. To ensure that the reserves correspond to the FRT in circulation, the reserves are regularly audited. The audit reports are available on the VNX website in the section “Transparency".