01
The War Thesis
Defense spending keeps rising, and it does not move on hype cycles. Budgets are planned over multi-year horizons, many programs run for years, and demand is driven by governments rather than by consumer trends.
Picking one defense stock is a bet on one company. An index is a bet on the whole sector.
Why an index
Defense is a basket business: prime contractors, drones, naval, defense software, engines and parts. One lost contract can sink a single name. Spread across ten assets, that risk is shared across the basket. This is why the defense sector fits an index structure better than any single stock.
The research
Every asset in $WARD is selected and weighted by our research. The goal is twofold: balance the risk across segments of the sector, and concentrate exposure on the assets we believe will perform best.
BALANCERisk spread across ten assets and several segments
CONVICTIONWeights tilted toward what we believe performs best
02
The Concept
$WARD brings a traditional index structure onchain. The protocol selects a basket of 10 defense and security-related assets and assigns each asset a defined weight within the index.
Users interact with the index through a dedicated vault. The vault holds the underlying Stock Tokens and continuously tracks the value of the portfolio.
The result is a single onchain structure representing exposure to the entire basket rather than an individual company.
03
The $WARD Index
The initial index consists of 10 assets. Each constituent receives a predefined allocation within the portfolio. The index is designed to cover different segments of the defense and security ecosystem, including:
Prime contractors
Defense software
Naval
Drones & hypersonics
Aerospace
Engines & parts
The initial composition and target weights:
| Ticker | Company | Target weight |
|---|
| LMT | Lockheed Martin | 20% |
| PLTR | Palantir | 15% |
| LHX | L3Harris | 15% |
| HII | Huntington Ingalls | 10% |
| KTOS | Kratos Defense | 10% |
| AVAV | AeroVironment | 10% |
| BA | Boeing | 5% |
| GE | GE Aerospace | 5% |
| HWM | Howmet Aerospace | 5% |
| RCAT | Red Cat | 5% |
04
The Vault
The vault is the core of $WARD. When users deposit into the protocol, most of the capital is allocated to the basket at target weights; the rest funds the USDG reserve and the LP. The vault then holds the corresponding underlying Stock Tokens.
Deposit→Vault→10 underlying assets→$WARD NAV
The vault maintains the portfolio allocation and tracks the total value of its holdings. Users therefore interact with one index rather than managing ten separate positions themselves.
05
Portfolio Allocation
Each of the ten constituents has its own predefined target weight.
The system rebalances the portfolio to bring allocations back toward their target weights. This keeps the index aligned with its published methodology rather than allowing individual positions to permanently dominate the portfolio.
06
Rebalancing
When the portfolio moves too far from its target allocation, the system rebalances the underlying positions.
Rebalancing can also occur when the index methodology requires a change to the composition of the basket. Each rebalance updates the portfolio according to the published index rules.
The objective is to keep the vault aligned with the $WARD index.
07
NAV
The value of $WARD is represented through the vault's Net Asset Value.
NAV = (Treasury assets + USDG side of protocol-owned LP) ÷ $WARD supply
The NAV reflects the total value of the portfolio. As the underlying assets move, the NAV of the vault changes accordingly. The protocol can publish:
Total vault value
Value of each underlying position
Current allocation
Current NAV
Number of units outstanding
Portfolio changes
This creates a transparent view of the index.
08
The $WARD Brief
Every major portfolio update is documented through a $WARD Brief. Each Brief can contain:
PORTFOLIOCurrent constituents and weights.
NAVCurrent total portfolio value and NAV per unit.
REBALANCINGChanges made to the portfolio.
INDEX CHANGESNew assets, removed assets or allocation changes.
TREASURYRelevant protocol holdings and activity.
The Brief becomes the public record of the index.
09
Mechanics
$WARD moves through four actions: the Genesis, minting, the LP bond and redeeming. $WARD only comes from the Genesis, minting and the LP bond. No $WARD is distributed any other way: no emissions, no rebases, no airdrops.
Genesis
The Genesis creates the initial treasury and funds the $WARD/USDG liquidity pool. The price rises along a linear curve from 3 to 12 USDG per $WARD as 1,200 $WARD are sold, so earlier buyers receive more $WARD per USDG.
CAPSSoft cap 3K · Hard cap 9K USDG
WALLET CAP250 USDG
ALLOCATION50% at TGE · 50% vesting
VESTINGLinear over 3 days, starting at TGE
USDG SPLIT50% basket · 50% $WARD/USDG LP
LP OPENING PRICE12 USDG per $WARD
If the soft cap is missed, every deposit is refunded. If it is reached, half of the USDG raised buys the basket and the other half seeds the $WARD/USDG LP. The protocol mints exactly enough $WARD to pair with that half at 12 USDG per $WARD, the top of the curve, whatever amount is raised.
TGE is the moment the LP goes live. 50% of each Genesis allocation unlocks at TGE and the other 50% vests linearly over the next 3 days. The vault opens at TGE.
Mint
Anyone can deposit USDG into the vault and mint new $WARD below the LP price.
MINT PRICENAV × 3r ÷ (2r + 1), with r = LP price ÷ NAV. Never below NAV
VESTINGMinted $WARD vests linearly over 24 hours
MINT DISCOUNTThe gap between the LP price and the mint price
SUPPLYEach mint creates new $WARD
The mint discount is the gap between the LP price and the mint price. The rule is simple: your upside to the LP price is two thirds of the LP premium over NAV. If the LP trades at 2× NAV (+100%), you mint at 1.2× NAV, with +67% of upside to the LP price. At 4× NAV (+300%), you mint at 1.33× NAV, with +200% of upside to the LP price at the time of minting. Minted $WARD vests over 24 hours, so the LP price can move before you can sell. The further the LP price sits above NAV, the bigger the discount.
When the LP price falls to NAV or below, minting closes. It reopens as soon as the LP price moves back above NAV.
LP bond
Holders of $WARD/USDG LP tokens can bond them to the treasury and receive $WARD, vested linearly over 24 hours. Bonding LP carries more risk than minting with USDG, so the LP bond pays a better ratio than the mint, and is never priced below NAV. The protocol keeps the liquidity it receives, which deepens the $WARD market over time.
Shares
The $WARD you hold is your share of the vault. Its value at NAV follows the basket: NAV per $WARD equals the treasury assets (stock tokens and liquid USDG) plus the USDG side of the $WARD/USDG LP the protocol owns, divided by the $WARD supply.
Redeem
$WARD can be burned for USDG from the treasury at NAV, minus a fee. The fee stays in the treasury, which raises NAV for every remaining holder.
STANDARD · 5%Open only while the LP price is below NAV
INSTANT · 15%Always open
Standard redeem helps pull the LP price back toward NAV: once the LP price is more than 5% below NAV, buying from the LP and redeeming at NAV becomes profitable before LP fees and slippage, which closes the gap. There is no guaranteed floor. Redemptions are paid from the liquid USDG reserve.
10
The First Vault
The first $WARD vault will establish the initial portfolio. The process is:
01Define the index
Select the initial ten assets and establish their target weights.
02Run the Genesis
Raise USDG on the 3 → 12 curve to create the initial treasury.
03Fund the portfolio and the LP
Buy the underlying stock tokens at their target weights and seed the $WARD/USDG liquidity pool.
04Open the vault
Mint, LP bond and redeem go live at TGE.
11
What's Next
The War Index is the first vault of the Worldward protocol. The same model works for any sector we have conviction in: research the assets, weight them to balance risk, and hold them in one onchain vault.
AINext on the research desk
ENERGYNext on the research desk
Each new index will run on $WARD and follow the same rules: published weights, a public NAV and a $WARD Brief for every major update.