Lending/Borrowing Protocol Fees/Info

Expect our lending/borrowing protocol to go live VERY soon.

Once the lending/borrowing contracts are deployed no changes will be able to be implemented. There is a set 10% fee on ALL pools created through our protocol. 10% of accrued interest from all these pools will be converted to eth and distributed to a smart contract that will then distribute to holder's based on their % of holdings.

How it works

Creating a new pool is simple. It is up to the individual who is creating the pool to know the risks and assess certain parameters like the market price, liquidity and risk tolerance of future investors who choose to utilize that pool.

There will be a two token system, the loan token and collateral token.

Maximum Collateral Ratio: The highest ratio at which borrowers are allowed to borrow loan tokens per unit of collateral tokens. For instance, suppose a pool accepts ETH as collateral tokens and USDT as loan tokens, and the maximum collateral ratio is 200:1. In that case, a borrower can borrow up to 200 USDT by providing 1 ETH as collateral. This collateral ratio remains unaffected by the prices of the tokens.

Pool Utilization Threshold: The utilization rate at which the collateral ratio begins to decrease, gradually reaching zero unless the pool's utilization drops below this threshold.

Collateral Ratio Decline Duration: The period it takes for the collateral ratio to decline from its maximum value to zero. This duration should be determined considering token volatility and other relevant indicators..

Collateral Ratio Recovery Duration: The amount of time required for the collateral ratio to recover from zero back to its maximum value. This duration should be established based on token volatility and other factors.