What happens when someone leaves, and why it does not dilute anyone
The intuition is that an exit costs the people who stay. It is a good intuition about badly designed pools, and wrong about proportional ones.
The arithmetic of leaving
Suppose the reserve holds a million dollars against a million coins: one dollar of backing per coin. Someone redeems a hundred thousand coins. The contract pays out a hundred thousand dollars of reserve and burns the coins.
The reserve is now nine hundred thousand. The supply is now nine hundred thousand. Backing per coin is one dollar — exactly what it was. The pool got smaller; nobody’s share of it changed.
That is what neutrality means here, and it is not a feature that has to be maintained. It falls out of paying a proportional slice and destroying a proportional number of coins in the same operation. A design that pays a fixed price instead, or pays from a buffer rather than the reserve itself, does not have this property and has to defend the level some other way.
Why the fee is not a punishment
Redemption carries a fee, and the fee stays in the reserve. So the honest version of the paragraph above is that the remaining holders end very slightly better off, not exactly level.
The fee is not there to discourage leaving. It is there because redemption has a cost the redeemer does not otherwise pay: it consumes reserve depth that the protocol maintains for everyone, and at the margin it lets someone time an exit against a price move. A small charge that stays in the pool prices that without closing the door.
Redemption itself is never suspended. Not during a currency ban, not while an address is being migrated, not when a vote is running. The contract has no pause on the way out, and that is the property everything else in the corridor rests on.
Two ways to be paid
The reserve holds several currencies, so a redemption has to decide which ones to hand over. Holders choose the method by vote, and both are proportional in a different sense.
The basket pays a cross-section of the pool: every currency in its current share, however small the balance. The structure of the reserve is preserved automatically, and the outcome does not depend on when the request arrives.
The most-capitalised method pays from the largest holding first. It concentrates the reserve less evenly but hands the redeemer a simpler payout, and it drains an unwanted currency faster when one is on its way out.
When a currency is leaving the reserve — banned, or disconnected by vote — either method skews towards it, up to a capped share above its proportional slice, so that its balance falls with every redemption rather than waiting for new deposits to dilute it.
Positions leave differently
A position is not a coin, and closing one is not redemption. A position is collateral deposited at a recorded cost of entry, and it can be returned in full at any time without touching anyone else’s arithmetic.
The interesting case is a position closed into coins when its recorded entry price sits above the current backing. That closing raises backing per coin for everyone, because it adds more reserve per coin than the average. The protocol treats this as work done for the pool and credits the closer with voting credits in proportion.
So the two exits are not symmetrical, and neither is a loss for those who remain. Redemption leaves the share untouched. A closing above backing lifts it.