WaykiChain(WICC) WUSD Good to Know (4)|CDP Operation Steps
Collaterized Debt Position (CDP), in which the encrypted assets pledged are locked in the pledge process of WaykiChain Stablecoin system. Any WICC holder can obtain a proportional amount of WUSD by pledging WICC to CDP. In this case, the ratio between the value of WICC assets and the value of WUSD obtained is the mortgage rate.
WaykiChain Stablecoin system stipulates that the minimum mortgage rate for CDP is 200%. Only one CDP can be created for each wallet address. After CDP is created by the mortgagor, it can be lent out, mortgaged and redeemed in batches (partial repayment) without closing CDP.
No additional mortgage assets
When the CDP mortgage rate is more than 200%, the case is the value of the mortgaged assets has exceeded 200 USD, the mortgagor can continue to lend WUSD without adding the mortgaged assets. As for the specific number of loans, as long as the guarantee of the final mortgage rate is not less than 200%, you can set their own loan line.
Additional mortgaged assets
Once the CDP mortgage rate drops to or even below 200%, such as 160%, if the mortgagor still wants to continue to lend more WUSD, it needs to invest additional mortgage assets into CDP and ensure that the mortgage rate of the new loan is not lower than the original CDP mortgage rate, which is 160% in this case. When the CDP mortgage rate is higher than 200%, the mortgagor can also lend more WUSD by adding mortgage assets. The latest mortgage rate of CDP shall not be less than 200%. In addition, when the mortgagor wants to increase the CDP mortgage rate more to prevent liquidation, he can also continue to invest in CDP mortgage assets without lending WUSD.
Partial redemption
When the mortgagor wants to redeem a part of the mortgaged assets, the amount of WUSD returned to the system shall also be able to ensure that the latest mortgage rate of CDP after redemption is not less than 200%. Of course, the mortgagor can also choose to only repay WUSD without immediately getting back the assets, which can rapidly increase the mortgage rate. The above is the possible situation for the mortgagor to maintain the CDP when the mortgage rate is changing. In addition, all maintenance operations of CDP need to pay interest corresponding to this CDP synchronously.
