Cancellations & Refunds

Overview

Understanding the cancellation and refund process is crucial for both producers and supporters on RedCarpetHQ. This guide explains when and how campaigns can be cancelled, and how refunds work.

Campaign Cancellation

Who Can Cancel?

Producers can cancel their campaign if:

  • The campaign is still in the Active state (before deadline)

  • They have a valid reason (explained to supporters)

    • Screeners can cancel a campaign if:

  • The campaign violates platform rules

  • The campaign contains fraudulent or misleading information

  • The producer violates Terms of Service

    • Platform can cancel if:

  • Legal issues arise (copyright, trademark violations)

  • Security concerns are identified

  • Smart contract vulnerabilities are detected

    • How to Cancel Your Campaign

    As a producer, you can cancel your campaign through the campaign management dashboard:

    1. Navigate to your campaign page
    2. Click "Manage Campaign"
    3. Select "Cancel Campaign"
    4. Provide a reason for cancellation
    5. Confirm the cancellation

    Important: Cancellation is irreversible. Once cancelled, the campaign cannot be reactivated.

    Refund Process

    Automatic Refunds

    When a campaign is cancelled or fails to reach its goal:

    For Active Campaigns:

  • Supporters can burn their tokens to receive their USDC back

  • Refunds are processed automatically through smart contracts

  • No fees are charged for refunds from cancelled/failed campaigns

    • For Failed Campaigns:

  • Campaigns that don't reach their goal by the deadline

  • Grace period expires without reaching the goal

  • Supporters can claim refunds by burning tokens

    • How to Claim a Refund

    1. Visit the campaign page
    2. Connect your wallet (the one you used to support the campaign)
    3. Click "Claim Refund" or "Burn Tokens for Refund"
    4. Confirm the transaction in your wallet
    5. Receive USDC back to your wallet

    Refund Timeline

  • Immediate availability: Refunds are available as soon as a campaign is cancelled or fails
  • No time limit: You can claim your refund at any time (though we recommend doing so promptly)
  • Gas fees: You'll need to pay gas fees for the refund transaction

    • Partial Refunds

    When Partial Refunds Occur

    Partial refunds may occur in specific situations:

    Producer Withdrawal:

  • If a producer has already withdrawn some funds before cancellation

  • Remaining funds are distributed proportionally to supporters

    • No Fee Deductions:

  • No platform fees are deducted from refunds

  • You receive the full proportional amount of your contribution

    • Calculating Your Refund

    ``
    Your Refund = (Your Token Balance / Total Token Supply) × Available USDC in Campaign
    `

    Special Cases

    Graduated Campaigns

    Important: Once a campaign graduates (successfully completes), refunds are no longer available:

  • Tokens become tradable assets

  • Funds are released to the producer

  • You can sell tokens on the marketplace instead

    • Campaigns with Dividends

    If a campaign has distributed dividends before cancellation:

  • Dividend payments are not refunded

  • You keep any dividends you've already claimed

  • Refund is based on your original contribution minus any dividends

    • Borrowed Against Tokens

    If you've borrowed USDC using your campaign tokens as collateral:

  • You must repay your loan before claiming a refund

  • The vault will automatically deduct outstanding debt

  • Remaining balance is refunded to you

    • Fees and Costs

    Platform Fees

    No fees for:

  • Refunds from cancelled campaigns (producer or screener initiated)

  • Refunds from failed campaigns

  • Refunds from campaigns that violate ToS

    • No platform fees apply:

  • Full refunds for supporters

  • No deductions from refund amounts (except gas fees)

    • Gas Fees

  • You always pay gas fees for blockchain transactions
  • Refund transactions require gas (typically small amount)
  • Consider gas prices when claiming refunds

    • Producer Responsibilities

    Before Cancelling

    Communicate with supporters:

  • Explain why you're cancelling

  • Post an update on the campaign page

  • Respond to supporter questions

    • Consider alternatives:

  • Can you adjust your campaign goal?

  • Can you extend the timeline?

  • Can you modify your project scope?

    • After Cancelling

    Follow-up:

  • Send a final update to supporters

  • Provide information about refund process

  • Maintain transparency about next steps

    • Future campaigns:

  • Cancelled campaigns may affect your reputation

  • Screeners may scrutinize future applications more carefully

  • Build trust by handling cancellations professionally

    • Supporter Rights

    Your Rights When a Campaign is Cancelled

  • Full refund of your contribution (minus any dividends received)
  • Transparent communication about why the campaign was cancelled
  • Timely access to refund mechanisms
  • Support from the platform if issues arise

    • What to Do If You Can't Claim Your Refund

    1. Check your wallet connection - Ensure you're using the correct wallet
    2. Verify token balance - Confirm you hold the campaign tokens
    3. Check for outstanding loans - Repay any borrowed amounts
    4. Contact support - Reach out if technical issues persist

    Dispute Resolution

    If You Disagree with a Cancellation

    For supporter-initiated disputes:

  • Contact the producer directly first

  • Escalate to platform support if unresolved

  • Provide evidence and documentation

    • For producer-initiated disputes:

  • If a screener cancelled your campaign unfairly

  • Contact support with your case

  • Provide evidence of compliance with rules

    • Mediation Process

    1. Submit a dispute through the support system
    2. Provide all relevant information and evidence
    3. Platform reviews the case (typically 5-7 business days)
    4. Decision is communicated to all parties
    5. Appeals may be possible in certain cases

    Best Practices

    For Producers

    ✅ Do:

  • Communicate early if you're considering cancellation

  • Provide clear, honest reasons for cancellation

  • Process refunds promptly

  • Learn from the experience for future campaigns

    • ❌ Don't:

  • Cancel without communicating with supporters

  • Cancel repeatedly (damages reputation)

  • Withdraw funds then cancel

  • Ignore supporter questions

    • For Supporters

    ✅ Do:

  • Claim refunds promptly when available

  • Keep records of your contributions

  • Understand the refund process before supporting

  • Reach out to support if you need help

    • ❌ Don't:

  • Wait indefinitely to claim refunds

  • Lose access to your wallet

  • Panic if a campaign is cancelled

  • Harass producers (use proper channels)

    • Tax Implications

    Important: Refunds may have tax implications depending on your jurisdiction:

  • Refunds are generally not taxable (you're getting your money back)

  • Dividends received before refund may be taxable

  • Consult a tax professional for your specific situation

  • Keep records of all transactions

    • Technical Details

    Smart Contract Refund Mechanism

    `solidity
    // Simplified refund process
    1. User calls burnForRefund(tokenAmount)
    2. Contract burns user's tokens
    3. Contract calculates refund: (tokenAmount / totalSupply) × availableUSDC
    4. Contract transfers USDC to user
    5. Event emitted for tracking
    ``

    Security Considerations

  • Refunds are processed through battle-tested smart contracts
  • No centralized party can block your refund
  • Blockchain ensures transparency and fairness
  • All refund transactions are publicly verifiable

    • Frequently Asked Questions

    Q: How long does it take to receive my refund?
    A: Refunds are instant once the transaction is confirmed on the blockchain (typically 1-2 minutes).

    Q: Can I get a refund if the campaign succeeded?
    A: No, once a campaign graduates, refunds are no longer available. You can sell your tokens on the marketplace instead.

    Q: What if I lost access to my wallet?
    A: Unfortunately, we cannot help recover lost wallets. Your tokens and refund rights are tied to your wallet's private keys.

    Q: Are there any fees for refunds?
    A: No platform fees for refunds from cancelled/failed campaigns, but you pay gas fees for the blockchain transaction.

    Q: Can I get a partial refund?
    A: You can burn any amount of your tokens for a proportional refund, but this is only available for cancelled/failed campaigns.

    Related Resources

  • Campaign Lifecycle
  • Managing Campaigns
  • Terms of Service
  • FAQ
  • Contact Support

    • Need Help?

    If you have questions about cancellations or refunds, contact our support team at support@redcarpethq.org.