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Debt System

Debt

1. Minting debt

After the user stakes native assets to mint synthetic assets, the amount of synthetic assets minted is their minting debt. A user minted 100 USDP by staking some ATP tokens. In the mean time, it also generated 100 USDP minting debt.

2. Stabilization debt

Stabilization debt is a stability fee designed based on mortgage rates. It is also one of the components of the debt system and affects the current mortgage rates. Each account is required to pay a stability fee based on the difference between the liquidation price and the current price as well as the time period, at the time of the increasing/withdrawal of collateral, minting, debt repayment and liquidation. The stability fee is paid in the form of synthetic assets.

3. Debt Positions

Pumo will list all debt positions of users wallet. PUMO v1.0 has two kinds of debts:aETH - USDP and ATP - USDP. The main indicators of the debt positions interface include:
1)Quantity/Value of the Underlying Asset:Display the current amount of underlying assets staked. Value = Quantity * oracle price of the underlying asset against USDT.
2)Quantity/Value of the Synthetic Asset:Display the current amount of synthetic assets minted. Value = Quantity * oracle price of the synthetic asset against USDT.
3)Stability Fee:Refer to the definition description of "stability fee" above.
4)Mortgage Rate:Mortgage rate = (Minting debt + Stability Fee)/ Underlying Asset Value * 100%;
5)Liquidation Rate:When the real-time mortgage rate is greater than or equal to the liquidation rate, the user's debt position can be liquidated;
6)Liquidation Price:Liquidation Price = (Minting debt + Stability Fee)/ (Liquidation Rate * Underlying Asset Value);
7)Status:Displays the risk profile of each position, including pending liquidation, alert, monitoring and healthy.

4. Debt Positions Liquidation Alert

When a user minted a synthetic asset, the real-time mortgage rate will change as the price of the underlying asset floats. When the real-time mortgage rate is greater than or equal to the liquidation rate, the user's debt position can be liquidated. Therefore, we added the a risk status indicator of the debt position in the UI interface to show how healthy of user's current debt position.
1)Pending Liquidation:real time mortgage rate ≥ liquidation rate;
2)Alert:liquidation rate ≥ real time mortgage rate ≥ initial mortgage rate;
3)Monitoring:initial mortgage rate > real time mortgage rate ≥ initial mortgage rate *70%;
4)Healthy:initial mortgage rate *70% > real time mortgage rate。
Last modified 3mo ago