Lending Questions

1. Q: In what token do we pay interest paid for deposits and borrowings?

A: Give what you save, and repay what you borrow.

2. Q: Can any random token be used as collateral?

A: Collateral refers to assets with strong consensus and good liquidity, such as USDT, EOS, etc. After depositing, other tokens are lent as asset security. The criteria for becoming collateral are stricter, and not any token can be used as collateral

3. Q: Is the interest of the deposit settled immediately?

A: The interest of the deposit is settled in seconds, and it is compounded

4. Q: Can bTokens be transferred?

A: Yes, bTokens are standard EOS tokens, which can be transferred freely. Different deposit certificates correspond to different markets. It represents your share of deposits in the lending market, and is the only proof of getting your assets back. When you transfer the deposit certificate to another EOS account, the right to retrieve the corresponding assets and the right to receive the subsequent deposit and mining rewards will also be transferred. Please take good care of your deposit certificates (bTokens).

5.Q: Will there be a handling fee for borrowing?

A: Yes. 0.02% borrow amount will be charged as handling fee each time.

6.Q: What is a health factor?

A: Health factor: Represents the degree of debt safety. When the health factor is higher, the debt is safer, and it is hardly to trigger liquidation when the market changes. When the health factor is less than 1, the debt liquidation is triggered.

7.Q: What is the calculation rule of interest?

Deposit interest rate

• After the user deposits a certain token, the deposit interest will be calculated according to the real-time deposit APY of the token. The exchange rate of bToken will be updated.

• When the user withdraws the deposit, the system uses the exchange rate of bToken to calculate the capital and interest that the user deserves.

• Deposit APY = loan annualized rate × utilization rate × (1-reserve factor)

Loan interest rate

• After the user borrows a certain token, the loan interest rate will be calculated according to the real-time loan annualized rate of the token.

• Loan interest is calculated based on the token of the loan.

• During the unpaid loan period, the loan interest generated will have an impact on the health factor, and the health factor will gradually decrease until 1 to trigger liquidation.

• When the current utilization rate is less than the target utilization rate, the loan annualized rate= initial rate R0 + (current utilization rate/target utilization rate)/ maximum rate R1.

• When the current utilization rate is bigger than the target utilization rate, the loan annualized rate= initial rate R0 + maximum rate R1 + (current utilization rate-target utilization rate) / (1- target utilization rate) * maximum rate R2.

8.Q: What is the loanable amount?

A: The loanable amount represents the total value of tokens you can borrow. Loanable amount = (∑ collateral value × the maximum staking ratio of the collateral)-total loan value.

9.Q: What is debt liquidation?

A: When the user’s health factor is less than 1.0, the system will liquidate the user’s collateral. After the liquidation, if the health factor is greater than 1.0, it will no longer participate in the liquidation, otherwise the system will continue to participate in the liquidation until the user’s collateral cannot afford the repayment, and the system will be as the final liquidator, which is repaid by the risk reserve fund.

Note: The liquidator can restore the user's health factor by auction to 1.05 at most each time.

The specific liquidation process are as follows:

(1) When the health factor of the debt user is less than 1.0, enter the liquidation queue. (2) The liquidators conduct auctions to help the debt user recover the health factor, which can reach a maximum of 1.05. If the amount of the auction exceeding the threshold is not involved in the auction, it will be refunded to the liquidator. (3) If the debt user's health factor of the debt is greater than 1.0 after the auction, the debt user will immediately withdraw from the liquidation queue. (4) If the health factor of the debt user is still less than 1.0 after the auction, it will continue to re-enter the liquidation queue. (5) In extreme cases such as unilateral continuous market conditions, the system will be the final liquidator and the risk reserve will be used to repay.

10.Q: What should I do if the deposit cannot be withdrawn?

A: Under the normal circumstances, deposits can be withdrawn at any time, unless the deposit pool is emptied and the utilization rate is close to 100%, the deposit APY will rise sharply, and new deposits or borrower repayments are gradually established to supplement market liquidity. So please wait patiently for the market to replenish liquidity while enjoying the high deposit income.