Although the primary use case of
ARTHLoans is not generating revenue, instead, it is for users to take out seamless loans in a stable valuecoin, that is resistant to inflation. DeFi users, however, can generate revenue via:
- Liquidating low CR% loans
- Participate in various staking/LP pools with partner projects and earn rewards in
MAHAand partner tokens
- Metamask or any web3 compatible wallet installed.
- Collaterals in the form of the native blockchain token (
To become a Stability Provider, you need
ARTHcan be borrowed by putting in collateral in the form of opening a loan position. Alternatively, you can also buy
ARTHfrom the open market directly from a DEX.
To make liquidations profitable, the borrower needs to keep away a gas fee compensation at the time of borrowing
ARTH. The current gas fee compensation is 5
ARTH(or roughly $10) on PoS chains and roughly 50
A borrower can only take out a loan, by creating a debt position of not less than 50
ARTHon PoS chains and 250
Almost anybody can liquidate a loan position.
The requirement to liquidate a loan position is simply:
Current Collateralization Ratio < Minimum Collateralization Ratio
Minimum Collateralization Ratio in Normal mode: 110% Minimum Collateralization Ratio in Recovery mode: 150%
For every liquidation, the liquidator will have to pay gas fees. To make sure, liquidations are profitable, a significant gas fee is kept aside at the time of borrowing a loan.
Currently, the gas fee compensation is set at 5 ARTH or $10 acc to the current GMU of $2.
The CR in Recovery Mode is 150%. While the CR in normal mode is 110%.
Yes. While the redemption fee remains the same, the borrowing fee is changed to 0% to encourage borrowing in the system.
As a borrower, simply increasing your collateral ratio to >150% will protect you from any liquidations. Thus, you will have to either a) add more collateral or b) repay some debt
Yes. You will be in line for liquidations if the loans who have a collateral ratio below yours aren't enough to bring the protocol back out of recovery mode.
If you have any further questions, you'd like us to answer