Collateral Asset Parameter Modeling

This section describes the modeling applied to arrive at the lending parameters for each collateral asset on the Primary Lending Platform.
When assessing a new coin, the following criteria will determine its initial parameters:
  • Loan-to-Value Ratio (LVR)
  • Debt Limits/Maximum Borrowing Capacity (MBC)
  • Liquidator Reward Percentage (LRP)
The aim of deriving suitable values for these collateral asset parameters is to balance the competing purposes of maximizing both the platform’s stability and its long-term user adoption. Deriving suitable parameters employs a systematic and logical approach with a rationale that reflects the characteristics of each collateral asset.