> For the complete documentation index, see [llms.txt](https://synthesys-2.gitbook.io/synthesys-docs/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://synthesys-2.gitbook.io/synthesys-docs/network-overview/how-it-works.md). # How It Works ### Subscription: How Fund Tokens Are Minted
When an investor wants to buy fund tokens, the sub-distributor submits the order via the Synthesys Network API. Pinetree processes the request and delivers tokens to the sub-distributor's whitelisted wallet, typically within one business day. | # | Who | Action | Detail | | - | ----------------------------------- | ------------------------------------ | ------------------------------------------------------------------------------------------------------------------------------------------------ | | 1 | Investor → Sub-Distributor | Order placed | Investor requests to purchase fund tokens. The sub-distributor captures the order details. | | 2 | Sub-Distributor → Synthesys Network | Submitted via Network API | The sub-distributor sends the subscription order through the Synthesys Network API. | | 3 | Synthesys Network → Pinetree | Order received by master distributor | Pinetree receives the subscription request and reviews the order. | | 4 | Sub-Distributor → Pinetree | Fiat or stablecoin payment sent | The sub-distributor transfers the agreed fiat or stablecoin amount to Pinetree to settle the subscription. | | 5 | Pinetree → Sub-Distributor | Fund tokens delivered | Pinetree processes the order and delivers fund tokens to the sub-distributor's whitelisted wallet, within one business day of the daily cut-off. | | 6 | Sub-Distributor → Investor | Downstream distribution | The sub-distributor decides how to allocate or transfer tokens to the end investor — on-chain transfer, custodial credit, or otherwise. | *** ### Redemption: How Fund Tokens Are Burned
When an investor wants to exit, the sub-distributor submits a redemption request via the Synthesys Network API. The sub-distributor sends fund tokens to Pinetree, who processes the burn and returns fiat or stablecoins within one business day. | # | Who | Action | Detail | | - | ----------------------------------- | ------------------------------------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | | 1 | Investor → Sub-Distributor | Redemption request | Investor asks to sell their fund tokens. The sub-distributor captures the number of tokens to be redeemed. | | 2 | Sub-Distributor → Synthesys Network | Submitted via Network API | The sub-distributor sends the redemption request through the Synthesys Network API. | | 3 | Synthesys Network → Pinetree | Order received by master distributor | Pinetree receives the redemption request and reviews the order. | | 4 | Sub-Distributor → Pinetree | Fund tokens sent | The sub-distributor transfers the fund tokens to Pinetree for redemption processing. | | 5 | Pinetree → Sub-Distributor | Fiat or stablecoins returned | Pinetree processes the redemption, burns the fund tokens, and returns the corresponding fiat or stablecoin proceeds to the sub-distributor, within one business day of the daily cut-off. | | 6 | Sub-Distributor → Investor | Investor settlement | The sub-distributor settles with the end investor — bank transfer, stablecoin, or any arrangement suited to the relationship. | *** ### Worked Example: Apex Capital > **Scenario:** Apex Capital (sub-distributor) subscribes $100,000 into Fund A, then redeems 2,000 tokens. | | Detail | | ------------------- | ---------------------------------------- | | **Sub-Distributor** | Apex Capital · `distributorId: PT000123` | | **Investor** | Registered investor · `userId: US000456` | | **Fund** | Fund A · `shareClassId: SC000789` | | **NAV** | $50.00 per token | #### Subscription: Apex buys $100,000 of Fund A **Step 1: Investor places order** The investor tells Apex Capital they want to invest $100,000 into Fund A. Apex captures the order internally. **Step 2: Apex submits via Network API** json ```json POST /api/v1/orders/subscribe { "distributorId": "PT000123", "userId": "US000456", "shareClassId": "SC000789", "amount": 100000, "currency": "USD", "walletAddress": "0xApex...wallet", "chainId": "1" } ``` The API returns an order ID: `ORD-20240421-001` **Step 3: Pinetree receives the order** Pinetree receives the subscription request and queues it for the next daily cut-off. Pinetree will communicate back to Apex to proceed to the next step. **Step 4: Apex transfers $100,000 to Pinetree** Apex sends $100,000 USD (or equivalent USDC) to Pinetree's settlement account. **Step 5: 2,000 Fund A tokens minted and delivered** NAV = $50.00 · $100,000 ÷ $50.00 = **2,000 tokens** Pinetree delivers 2,000 Fund A tokens to Apex's whitelisted wallet within 1 business day. **Step 6: Apex allocates tokens to the investor** Apex credits the investor's account — on-chain transfer, custodial record, or any arrangement that suits the relationship. > Apex can track the order at any time via `GET /api/v1/orders/ORD-20240421-001` and will receive a `token.transfer_completed` webhook once tokens land. *** #### Redemption: Apex redeems 2,000 Fund A tokens **Step 1: Investor places redemption request** The investor wants to exit. They ask Apex to redeem their 2,000 Fund A tokens. **Step 2: Apex submits via Network API** json ```json POST /api/v1/orders/redeem { "distributorId": "PT000123", "userId": "US000456", "shareClassId": "SC000789", "tokenCount": 2000, "walletAddress": "0xApex...wallet", "chainId": "1" } ``` The API returns an order ID: `ORD-20240422-001` **Step 3: Pinetree receives the order** Pinetree receives the redemption request and queues it for the next daily cut-off. **Step 4: Apex sends 2,000 tokens to Pinetree** Apex transfers the 2,000 Fund A tokens from its wallet to Pinetree's designated redemption address. **Step 5: Tokens burned — $100,000 returned to Apex** Pinetree burns the 2,000 tokens and returns $100,000 (at current NAV) in fiat or stablecoins to Apex within 1 business day. **Step 6: Apex settles with the investor** Apex receives $100,000 and settles with the investor via bank transfer, stablecoin, or any agreed arrangement. > Apex can track the order via `GET /api/v1/orders/ORD-20240422-001` and will receive an `order.accepted` webhook once Pinetree confirms processing. --- # Agent Instructions This documentation is published with GitBook. GitBook is the documentation platform designed so that both humans and AI agents can read, navigate, and reason over technical content effectively. Learn more at gitbook.com. ## 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, and the optional `goal` query parameter: ``` GET https://synthesys-2.gitbook.io/synthesys-docs/network-overview/how-it-works.md?ask=&goal= ``` `ask` is the immediate question: it should be specific, self-contained, and written in natural language. `goal` is optional and describes the broader end goal you are ultimately trying to accomplish on behalf of the user. GitBook uses it to tailor the answer towards what is most useful for that goal. 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.