Liquidations
Learn how to participate in the liquidations market
Last updated
Learn how to participate in the liquidations market
Last updated
This documentation is a work in progress!
of unhealthy 's within the protocol can be done by anyone and the protocol incentivizes it.
Liquidators must obtain equal amount of the Kopio Asset repaid on behalf of the liquidatee. These are burned and the debt balance of the liquidatee is reduced accordingly. Protocol then calculates the amount of collateral to seize, removes it from the liquidatees and transfers it to the liquidators address.
When a liquidator repays debt on the unhealthy CDP, in return they receive the liquidatees collateral at a discount according to the . This rewards the liquidators in exchange for the repayment cost and effort.
Thing to understand in liquidations is the difference between (LT) and the (MCR).
An account in the protocol is considered liquidatable when the ratio of collateral to debt is less than the LT. MCR is used to decide whether the CDP is allowed to take on more debt. While MCR is similar to the LT, it won't make an account liquidatable. The possible gap between these ratios is a safety buffer and it prevents users from creating extremely risky positions which would get liquidated in the slightest market movement.
Three main options exist to natively acquire Kopio Assets.
Buy the assets from some 3rd party AMM liquidity.
All protocol code is public on GitHub
the assets from the protocol against collateral.
Provide underlying assets for a 1-1 .
Acquire with USDC, optionally exchange acquired ONE using the to any Kopio Asset.
Contracts
Addresses
Protocol Repository