Borrowing Perks
Important things to know as a borrower.
Last updated
Important things to know as a borrower.
Last updated
We have a very specific set of rules/perks which we, as a company, will explicitly specify to our users, in order to avoid confusion and let them know what the involved costs are, for the usage of our utility, beyond our own revenue. As we provide a smart contract related service, users will also have to account for the fees of dealing with such. The main things to consider are specified down below.
Borrowing does not include your contract deployment fees.
Borrowing will not take away any tax from your project, nor do we force you to have any liquidity tax; however it's obviously preferred and will make it easier to borrow a position if you do so.
Our platform offers safe contracts with everything you need for your token.
The borrower can of course, not remove the liquidity, and has to choose an initial lock time when he borrows - time which is tied to a cost.
Borrowing costs from Treasury are fixed and explained on its respective section. Borrowing from other people, however, follow the lender's own rules and rates.
Airdrops are given at a fixed rate, which applies to every borrowing method. If you are getting a 5% airdrop over 1ETH of liquidity, you need to pay for the exact value of 0.05ETH.
In the case of a coin out-lasting the agreed-on period for a borrowed amount of time, the definition of the price for a buyout on its liquidity is defined as follows, between these two paths: a) Keep paying for its borrowed amount. b) Buyout the liquidity.
a) is pretty simple. Just pay the same monthly fee. However, most of the devs whom have a project last longer than a few months, will surely be able to afford a buyout, so let's focus on that. b) Buying out the liquidity is a process which will be defined the following way: Initial_liq+monthly+0.1% of volume. So, for b), let's say a token started with borrowing 1ETH(initial_liq), and had 1M volume. In this case, the buyout charge will stand at 1+0.1(monthly)+$1000(0.1% of 1M).
It's important to note that, according to UNISWAP V2, Liquidity owner gets 0.25% of volume accrued, meaning that would be taking $1000 out of $2500, thus leaving a profit on both the dev's end, and the protocol's. For coins which want to burn their liquidity once it unlocks, we'll take Initial_liq + monthly price, so it'd be 1.1ETH for the aforementioned scenario. In this case, there won't be a profit for the dev when it unlocks, so it'd be unfair to charge them for the accrued value of a burned liquidity.