Collateral and Liquidation

Vault Collateral Asset

A vault can only bridge through one particular collateral. If an owner wants to provide multiple collaterals, they will have to deploy a new vault for each pair.

Collateral division

Below we define some parameters to help define what elements make up the collateral:

Type	Role	Formula
Used Collateral	Currently used collateral	Backed Tokens * Secure Threshold
Backed Tokens		Issued Tokens + Tokens to be issued
Maximum Collateral	Maximal amount of stable-coin that can be collateralized	Defined on Asset pairs
Minimum Collateral	Minimal deposit	30 DOT (Pendulum) 3 KSM (Amplitude)
Security Threshold	Amount of collateral that enables a vault to store up to X amount of asset	See table
Liquidation Threshold	Amount of collateral after which the vault will start getting liquidated	See table
Premium Redeem Factor	Grants users redeeming at this level a premium on the collateralized asset	See table

Collateral Data for Pendulum

Stellar Asset	Asset	Security Threshold	Premium Redeem	Liquidation
USDC	DOT	160%	140%	125%
BRL	DOT	160%	140%	125%
XLM	DOT	160%	140%	125%
TZS	DOT	160%	140%	125%
NGNC	DOT	160%	140%	125%
EURC	DOT	160%	140%	125%
AUDD	DOT	160%	140%	125%

Collateral Data for Amplitude

Stellar Asset	Asset	Security Threshold	Premium Redeem	Liquidation
USDC	KSM	160%	140%	125%
BRL	KSM	160%	140%	125%
XLM	KSM	160%	140%	125%
TZS	KSM	160%	140%	125%
NGNC	KSM	160%	140%	125%
EURC	KSM	160%	140%	125%
AUDD	KSM	160%	140%	125%

Liquidation

A Liquidation can happen for a variety of reasons:

• The Vault fails to execute a redeem on time

  • In this case the user can either retry with another vault or liquidate a part of the vault

  • The vault is banned from accepting further requests for some time

• The Vault falls below the Liquidation threshold

  • In this case, the entire collateral is liquidated