Position Unwrapping

The unwrapping functionality of our system has been developed with precision to serve the intricate requirements of lending, borrowing, and yield-generating markets:

• Initial Conversion: The process commences with the transformation of the CDT token into the LP token, utilizing the price determined on-chain.

• Asset Breakdown: Subsequently, the LP token is dissected into its foundational assets, which are then returned to the requester. This streamlined approach eliminates a redundant step for liquidators, providing them with direct control over the underlying assets.

System design for future adaptability:

• Our infrastructure is intentionally designed to be forward-looking, ready to embrace additional modules as new requirements surface.

• In scenarios where the unwrapping process necessitates further actions, our system's architecture boasts the flexibility to seamlessly incorporate new modules, catering to the dynamic needs of the market and our partners.

This structured approach underscores our commitment to efficiency and adaptability, ensuring our system remains at the forefront of addressing the evolving demands of the decentralized finance landscape.

Unwrapping Process

The process is akin to making a withdrawal, but instead of receiving liquidity pool (LP) tokens, you will obtain the underlying assets. It's important to note that this process incurs a commission, as detailed in the subsequent section. A critical aspect to understand is the necessity for you to apply your own slippage to the amounts received, as we do not impose any slippage on our end. This functionality is primarily intended for liquidators rather than regular users.

Money-Market Liquidation Module

Our system equips liquidators with the ability to take over a user's base asset position by using the sellForLpAndWithdraw function. This functionality allows for flexible liquidation strategies, enabling liquidators to partially liquidate positions while maintaining some assets within the position. This method ensures efficient liquidation processes without the need for completely closing a user's position.

Additionally, our Liquid Vault protocol takes a distinct approach to transaction slippage. Unlike typical protocols, we do not automatically compensate for slippage during withdrawal and unwrapping operations. Instead, users bear the responsibility of managing slippage risks, reflecting our policy of granting users control while engaging with our platform's complex features. This approach emphasizes the importance of user involvement and a deep understanding of the protocol's mechanics.