The following diagram shows the flow of funds for a single Prize Pool instance. "Instance" here is really referring to an aggregate of contracts that together form a "Prize Pool".
- First a user deposits into the Prize Pool.
- The Prize Pool deposits those funds into a yield source, such as Compound or Aave.
- The Prize Pool is instructed by its strategy to divert the interest to the Reserve contract. The reserve measures the amount of funds that have been added.
- The Reserve contract sends funds to both the Prize Distributor (for users to claim) and to the prize pool network (to capture value).
- Users claim their prizes from the Prize Distributor.
- The prize pool network will deposit funds into the Prize Distributor to bootstrap prizes.