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Currently the liquidation mechanism for any CDP starts when the value of the collateral passes below the collateralisation ratio.
This means that any user who will borrow the maximum amount available will suffer liquidation as soon as the price of the collateral used moves downward.
Description
To avoid this inconvenience and improve user experience, we want to modify the threshold at which the liquidation starts.
A community member suggested the liquidation starts when the value of the collateral passes below the 100% value borrowed rather than the collateralisation ratio (e.g. 100% instead of 150% if the collateralisation ratio for that vault is 150%).
Further analysis on the behavior and requirements is needed before proceeding with the implementation.
Definition of Done
TBC after business and technical analysis is complete.
Requirements
TBD
The solution proposed should ensure robustness and security of the protocol and user funds.
The text was updated successfully, but these errors were encountered:
Problem statement
Currently the liquidation mechanism for any CDP starts when the value of the collateral passes below the collateralisation ratio.
This means that any user who will borrow the maximum amount available will suffer liquidation as soon as the price of the collateral used moves downward.
Description
To avoid this inconvenience and improve user experience, we want to modify the threshold at which the liquidation starts.
A community member suggested the liquidation starts when the value of the collateral passes below the 100% value borrowed rather than the collateralisation ratio (e.g. 100% instead of 150% if the collateralisation ratio for that vault is 150%).
Further analysis on the behavior and requirements is needed before proceeding with the implementation.
Definition of Done
TBC after business and technical analysis is complete.
Requirements
TBD
The solution proposed should ensure robustness and security of the protocol and user funds.
The text was updated successfully, but these errors were encountered: