# Conversion & Redemption

TORCH and xTORCH are mutually convertible into each other, but the process is different depending on the direction.

#### TORCH to xTORCH Conversion

TORCH can be freely converted into xTORCH at any time. The process is instantaneous, and the ratio is 1:1.

#### xTORCH to TORCH Redemption

Converting xTORCH into TORCH implies vesting, the duration of which is selected by the user. The conversion ratio will increase proportionally with the vesting duration:

* The minimum vesting duration of 15 days will provide a 1:0.5 ratio
* The maximum vesting duration of 6 months will provide a 1:1 ratio

{% hint style="warning" %}
If the selected vesting duration is lower than the maximum (ratio < 1:1), the unclaimed excess TORCH is burned.
{% endhint %}

{% hint style="info" %}
Example:

**User 1** chooses to redeem 1000 xTORCH to TORCH over a 15 day period. After 15 days, the user receive 500 TORCH. The other 500 TORCH is burned.

\
**User 2** chooses to redeem 1000 xTORCH to TORCH over a 6 month period. After 6 months days, the user receives their entire 1000 TORCH.&#x20;
{% endhint %}

### Automatic Dividends Allocation During Redemption

While being redeemed, the xTORCH is automatically allocated to the [Dividends](https://docs.hercules.exchange/hercules/protocol/xtorch-plugins/dividends-plugin) plugin for the user, but only grants 50% of the typical rewards. This allocation is automatically canceled once the vesting duration has ended.

{% hint style="info" %}
Example: A user chooses to redeem 1000 xTORCH into TORCH over a 6 month period. During that conversion period of 6 months, the user receives rewards through the Dividends plugin at half the rewards rate as a user who allocated 1000 xTORCH to the Dividends plugin.
{% endhint %}

#### Canceling a Redemption

The xTORCH redeeming process can be  interrupted at any time by the user.

{% hint style="warning" %}
Any canceled redemption before its end will void the whole process. The user will retrieve their entire amount of  xTORCH and no TORCH.
{% endhint %}