# Minimum Funding

Every ZAP auction has a **soft cap** — a minimum amount of funding that must be raised for the auction to be considered successful. This requirement exists to protect bidders: if a token launch doesn't attract genuine demand, no one loses money.

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### What is the soft cap?

The soft cap is a fixed funding target established before the auction starts. It represents the minimum raise required for the auction to proceed and tokens to be distributed.

* If the auction **meets or exceeds** the soft cap → the auction **graduates** and tokens are distributed to bidders.
* If the auction **falls short** of the soft cap → the auction **fails** and every bidder receives a full refund.

This is a hard rule enforced by the smart contract. There are no exceptions or overrides.

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### What does "graduated" mean?

An auction **graduates** the moment cumulative auction proceeds reach or exceed the soft cap. This can happen at any point during the Active phase, but the outcome is only evaluated when the auction ends. The auction always runs its full duration regardless of whether it has already graduated.

When an auction graduates:

* You can exit your bid and then claim your token allocation
* Any unspent portion of your funding currency is refunded to you
* Unsold tokens are returned to the token treasury

When an auction does **not** graduate, see Failed Auction.

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### Reading the Minimum Funding card

The UI shows a progress bar for funding alongside the supply progress. It tracks:

| Metric                     | Description                                                           |
| -------------------------- | --------------------------------------------------------------------- |
| **Currency raised so far** | Total funding locked in by winning bids at the current clearing price |
| **Soft cap target**        | The threshold that must be reached                                    |
| **Progress %**             | How far along toward the soft cap the auction is                      |

Once the soft cap is reached, the card displays a graduation indicator. This is a signal to the community that — barring some extraordinary collapse in demand — the auction is on track to succeed.

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### Why does the soft cap matter to bidders?

Without a soft cap, a token team could launch an auction, collect whatever trickles in, and distribute tokens regardless of whether there was enough community backing to make the project viable. Bidders could end up holding tokens from a project that couldn't even sustain a minimal raise.

The soft cap is a transparent, on-chain commitment: if the bar isn't cleared, every cent you put in is returned to you. You always know the threshold before you bid.

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### Is there a hard cap (maximum raise)?

No. ZAP does not impose a maximum raise. The auction continues accepting demand — and the clearing price continues rising — for as long as new bidders are willing to enter at higher prices. There is no ceiling on how much a successful auction can raise.

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> Related: [Failed Auction](https://zealous-auctions.gitbook.io/zealous-auctions-docs/protocol/failed-auction) — what happens step by step if the soft cap isn't reached.
