BOB
  • πŸ‘‹BOB Stablecoin
  • BOB Info
    • πŸ—ΊοΈBOB Ecosystem
      • Mellow Protocol Vaults
    • 🦊MetaMask
      • Swap BOB with Metamask Swap
    • πŸ”BOB Swap
    • πŸ¦„Uniswap v3
    • πŸ™‹β€β™€οΈBOB FAQ
  • BOB CDP
    • ℹ️About
    • πŸ’‘Use Cases
    • πŸ‘¨β€πŸŽ€System actors
    • πŸ“šSystem configurations
    • 🏦Vault health
    • 🏘️User flow examples
    • πŸ‘¨β€πŸ’»Technical docs
      • Position valuation (technical)
      • Liquidations
      • Deployment addresses
      • Smart Contracts
        • NFTVaultRegistry
        • NFTVault
        • UniV3Oracle
        • ChainlinkOracle
        • DebtMinter
        • SurplusMinter
    • πŸ™‹β€β™‚οΈCDP FAQ
  • BOB DAO
    • πŸ§‘β€πŸ€β€πŸ§‘Governance
      • BOB DAO
      • Protocol Governance
        • GP 0: Increase SAFE membership
        • GP 1: Bob Swap beta testing infrastructure
        • GP 2: Upgrade Contracts to v1.0.0
        • GP 3: Enable Bob Swap for Public Use
        • GP 4: Increase Multisig & Upgrade BOB contract on all networks
        • GP 5: Enable Bob Swap on Ethereum Mainnet
        • GP 6: Upgrade zkBob to support direct deposits
        • GP 7: Increase Multi-chain Inventory and Update Bob Swap
        • GP 8: Extend pool limits for KYC'd users
        • GP 9: Deactivate Kyberswap inventory pairs [Emergency Measure]
        • GP 10: Reallocate previous Kyberswap inventory
        • GP 11: Add 24 hour timelock to BOB contract on Optimism
        • GP 12: Raise Polygon limits
        • GP 13: Launch BOB CDP
        • GP 14: Migrate BOB pool to USDC on Polygon
        • GP 15: KYB tiers on Optimism
        • GP 16: Remove excess inventory on Arbitrum and BNB Smart Chain
        • GP 17: Remove excess inventory on Optimism and Ethereum
        • GP 18: Remove excess inventory on Polygon
        • GP 19: Accrued Revenue Allocation
        • GP 20: Migrate BOB pool to USDC on Optimism
        • GP 21: BOB inventory reduction
    • πŸ“‹Inventory
      • Inventory Actions
  • BOB Resources
    • 🧩Visual Assets
    • ⛓️Links
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On this page
  • Collaterals
  • Whitelists
  • Liquidators whitelist
  • Limits
  • Maximum debt per vault (100,000 BOB)
  • Minimum single NFT collateral (100 BOB)
  • Maximum number of NFT per vault (2 NFTs)
  • Global debt limit (500,000 BOB)
  • Fees
  • Liquidation premium (3%)
  • Liquidation fee (5%)
  • Stability fee (1% per annum.)
  • Risk parameters
  • Liquidation threshold/factor
  • Max borrow threshold/factor
  • Min position width
  1. BOB CDP

System configurations

BOB CDP is a decentralized borrowing protocol, however, there are certain parameters and risk factors that need to be established during runtime for smooth operation.

All BOB CDP parameters are configured according to Governance decisions.

Collaterals

Protocol governance is responsible for determining appropriate collateral types and their respective parameters. The following positions are currently being accepted as collateral:

Pool pair
Fee tiers
Max borrow factor
Liquidation factor
Min position width

BOB/USDC

0.01%

85%

90%

0

BOB/USDT

0.01%

85%

90%

0

BOB/MATIC

0.05%

73%

78%

1000

BOB/WETH

0.05%

78%

83%

1000

Whitelists

Liquidators whitelist

During the protocol beta launch and while the risk model has not been properly battle-tested, only whitelisted entities and bots are able to participate in BOB CDP liquidation process, starting with a BOB Core Team as a first liquidator. Liquidators whitelist requirements will be lifted once a protocol becomes more mature.

Limits

Protocol governance also has ability to setup multiple system-wide parameters. Limits are necessary to facilitate efficient liquidations and safety mechanimsm in the current implementation.

Maximum debt per vault (100,000 BOB)

Users are free to open multiple vaults and use them as they wish, however each vault is subject to the upper limit on the amount of issued debt. Having a total debt over this limit won’t lead to a liquidation, however the protocol won’t allow additional minting operations until the debt is partially or fully repaid.

Minimum single NFT collateral (100 BOB)

Each deposited collateral NFT should be worth at least 100 BOB at the moment of the deposit.

Maximum number of NFT per vault (2 NFTs)

After any successful collateral deposit, a vault cannot store more than 2 NFT collaterals.

Global debt limit (500,000 BOB)

Fees

Liquidation premium (3%)

During a successful liquidation, the liquidator repays BOB amount equal to the fraction of the total current collateral value. The difference between repaid value and total collateral value is the liquidation premium.

Liquidation fee (5%)

Upon successful liquidation, they protocol treasury receives an extra liquidation fee, also calculated as a fraction of the total collateral value.

Stability fee (1% per annum.)

Borrowers are charged with a consistent, fixed debt stability fee on the total amount of their active debt.

In the event of high market volatility, liquidators might not be able to perform their duties in a timely manner, so that total collateral margin is enough to cover all the fees. In this case, the following repayment tranches are used (from highest priority to lowest):

  1. Liquidation premium (paid to the liquidator)

  2. Liquidation fee (paid to the treasury)

  3. Owed remainder (paid to the borrower)

Risk parameters

Liquidation threshold/factor

A pool-specific parameter describing LTV factor. When reached, the position is subject to liquidation.

Max borrow threshold/factor

A pool-specific parameter describing LTV factor, limiting the borrow amount at the time of the actions intending to increase vault LTV (debt mint, collateral withdrawal).

Should be slightly less than the liquidation threshold/factor, to provide some safety margin for the borrower against potential instant liquidation.

Min position width

Volatile pairs can be restricted on the min width of the position price range, in Uniswap V3 tick.s

Min width of 1000 ticks means that price range should be at least approximately 10% wide (e.g. +- 5% of the current spot price)

PreviousSystem actorsNextVault health

Last updated 1 year ago

Total BOB CDP minting allowance has a static hard ceiling established by governance. However, the effective immediate debt ceiling may be lower, as its rate of increase is limited over time. See a similar DC-IAM module approach in MakerDAO -

1 tick is equal to 0.01% price difference ()

πŸ“š
https://mips.makerdao.com/mips/details/MIP27
https://docs.uniswap.org/concepts/protocol/concentrated-liquidity#ticks