Grace Period Token Whitepaper
The Grace Period Token whitepaper was written and released by the GPT core team in Q4 2025, against the backdrop of a growing demand for more flexible and resilient risk management tools in the decentralized finance (DeFi) sector. It aims to address the challenges of liquidation risk and user asset security in current DeFi protocols caused by market volatility.
The theme of the Grace Period Token whitepaper is “Grace Period Token: Resilient Settlement and Risk Mitigation Mechanisms in Decentralized Finance.” What makes Grace Period Token unique is its proposal of a “resilient settlement window” and “conditional asset locking” mechanism, enabling temporary asset freezing and conditional release through smart contracts. The significance of Grace Period Token lies in providing DeFi users with a buffer period to cope with market fluctuations, significantly reducing unnecessary liquidation risks, thereby enhancing the robustness and user experience of the entire decentralized finance ecosystem.
The original intention of Grace Period Token is to solve the problems of capital inefficiency and sudden risks to user assets in DeFi protocols caused by instantaneous liquidation rules. The core viewpoint articulated in the Grace Period Token whitepaper is: by introducing a programmable “grace period” mechanism, combined with on-chain governance and dynamic risk parameter adjustments, it is possible to provide users with a more fault-tolerant and autonomous way to participate in decentralized finance, while still ensuring the overall security of the protocol.