If it sinks, your treasure is determined by fate (if other players took it, if its sinking, it its floating etc.). To my understanding if your ship did not sink, you would go right back to your ship, meaning left off where the battle/event was occuring. They make a large amount of sense and allow for all pirates to get a chance to either get their loot back or get back in the game as soon as possible. I think these solutions are implemented in order.

If outposts are nearer then each is sent to a different outpost. if there is no equal distance from the location the grid widens until each team can spawn on an island the same distance away. Have both ships sunk? Each ship is placed on an island as nearby as possible.

If the ship is in the process of sinking but has not yet been completely sunk then they respawn on the ship to attempt to repair it or swim in the water for a mermaid to go to a new ship. Has One of the sides' ship completely sunk? If yes, sorry Pirate you must respawn on a reasonable far away island to come back. Is there a Pirate on the killed player's ship? If Yes, Respawn in the water near to the ship (even if moving). B.) They respawn in the ocean waters to take a mermaid or try to climb the other ship. If A.) On their own ship - Respawn on their own ship. Here is my suggestions.Дid the pirate die in combat on their own ship or on an opposing teams ship? I think there needs to be a solution implemented. However, I don't want to get into a 45 minute battle over treasure because both sides cannot sink a ship and keep respawning and killing the other. On one hand, I see the respawning nearby or on the ship once you are killed so you can defend your loot. I think the game is in a strange spot with this type of issue.

Sea of thieves mods