Collateral Operations

Features for managing asset collateral that the parties may agree is also required to secure a line

Whitelisting a new collateral token

Any ERC-20 or ERC-4626 tokens that a Borrower wishes to use as collateral must be whitelisted ('enabled') by the Servicer. [The scope of collateral will widen in our next version to include LP tokens].

Borrower adds Collateral

A Borrower can at any time deposit whitelisted tokens as collateral after which the collateral ratio is updated.

Collateral Ratio

The ratio of the value of Collateral securing all the Line of Credit to the value of the Borrower's Total Outstanding Debt. [Soon this will include not only Collateral deposited by a Borrower in the traditional sense but also Reserves from the capture of Borrower Revenue by the Spigot]

Borrower withdraws Collateral

A Borrower can withdraw any amount of Collateral as long as the Min Collateral Ratio is maintained. After all Credit Lines have been fully repaid and closed, the status of the Line of Credit becomes 'repaid' and the Borrower can withdraw all remaining Collateral.

Borrower transfers Collateral to a new Line of Credit

After all Credit Lines have been fully repaid and closed, the status of the Line of Credit becomes 'repaid' and a Borrower can transfer (roll over) Collateral to a new Line without needing to withdraw it and deposit it again.

Servicer liquidates Collateral

When certain conditions are fulfilled the status of a Line may change to liquidatable. Only if the status is liquidatable, the Servicer is programmatically granted the permission to liquidate Collateral on behalf of Lenders.