> For the complete documentation index, see [llms.txt](https://docs.yodl.fi/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.yodl.fi/capital-access-and-protection/reputation-framework/operator-reputation.md).

# Operator Reputation

#### **Overview**

Every Operator begins with a Reputation Multiplier (RM) of **1.00** upon whitelisting. This value is stored on-chain and updated automatically after each epoch based on verifiable performance metrics.\
The RM acts as a dynamic trust coefficient, scaling the Operator’s **execution-credit ceiling.** 

Governance defines a global RM range of **0.50 ≤ RM ≤ 1.50**, ensuring no Operator can gain or lose influence excessively within a single epoch.

#### **Epoch Update Logic**

Positive behavior increases RM toward the upper bound; failures or restoration events decrease it proportionally.

#### Positive Reputation Factors

| **No Liquidation or Slashing Events** | Maintains solvency throughout epoch                   | +0.1  |
| ------------------------------------- | ----------------------------------------------------- | ----- |
| **Exceptional Execution Efficiency**  | Generated surplus ≥ 5 bps on YODL Delegated USD Value | +0.01 |

Maximum positive adjustment per epoch: +0.11.

#### Negative Reputation Factors

| **Bounded Liquidation Event**     | Triggered when HF ≤ 1.0                                  | −0.05                          |
| --------------------------------- | -------------------------------------------------------- | ------------------------------ |
| **Non-Repayment of Vault Assets** | Fails to restore by epoch end                            | −0.10 and temporary suspension |
| Restoration Reserve Usage         | Slashing sourced from the protocol’s restoration reserve | −0.20                          |

Maximum negative adjustment per epoch: −0.35.

#### **Blacklisting & Recovery**

* **Auto-Blacklist:**
  * `RM = 0.50` 
* **Re-Whitelisting:**
  * Requires governance approval and audit of prior epoch data (off-chain).
  * Upon reinstatement, RM resets to 0.90 (probationary).

#### On-Chain Enforcement  

• Update Frequency: Each time a relevant event occurs (liquidation, repayment, surplus).\
• Data Sources: Aggregated Orchestrator data.\
• Transparency: All RM adjustments and reasons are emitted on-chain for verifiability.

#### Governance Controls  

Governance may:\
• Define minimum and maximum RM bounds\
• Tune per-event reputation adjustments\
• Pause RM updates during system-wide incidents