# How to Use USDa

<figure><img src="/files/MbS3qOswBaOs80C8M4ht" alt=""><figcaption></figcaption></figure>

## **Buy USDa and sUSDa**

Users can easily buy USDa and sUSDa directly from supported decentralized exchanges (DEX).

## **Minting USDa**

There are two ways to mint USDa through Avalon’s CeDeFi CDP:

* **Minting USDa with Collateral**: Users deposit collateral into Avalon CeDeFi. Currently, collateral options include FBTC, with plans for expanding to more assets soon. Once collateral is deposited, users can request USDa loan. The amount of USDa available for borrowing is determined by the Loan-to-Value (LTV) ratio based on the type of collateral. Users have the flexibility to borrow multiple times as long as they maintain the required LTV.&#x20;
* **Minting USDa with USDT:** Users deposit USDT into Avalon CeDeFi and get USDa at 1:1 ratio.

The process is similar to Avalon's CeDeFi lending. In fact, CeDeFi CDP and lending share the technology and fund flows.

## **Withdrawing Process**

To withdraw collateral from CeDeFi Lending, users follow these steps:

1. **Initiating Withdrawal**: Users initiate a withdrawal request for their collateral. The withdrawn amount must meet LTV requirements. If users wish to withdraw all collateral, they must first repay the entire borrowed amount, including principal and interest.
2. **Claiming Collateral**: Collateral can be claimed by users within one business day of initiating the withdrawal request.

## **Repayment Process**

To repay USDa loan, users can repay any desired amount up to the total borrowed amount, which includes both principal and interest.

## **USDT Conversion Process**

The unique advantage of USDa is that USDa guarantees its conversion to USDT at 1:1 ratio. To convert USDa to USDT, users need to bridge their USDa to Ethereum mainnet and deposit the USDa to conversion vault. Users will be able to claim their USDT in one business day.

## **Liquidation Process**

If the Loan-to-Value (LTV) ratio exceeds the liquidation threshold, a portion of the collateral will be liquidated to bring the LTV back to a target level. During liquidation, the underlying collateral is sold on a centralized exchange using Avalon's proprietary high-frequency trading algorithm to minimize any impact on market prices.

## **Integration with DeFi**

<figure><img src="/files/ECJwp6jELOTV9oU4ovl9" alt=""><figcaption></figcaption></figure>

USDa is an omnichain stablecoin with DeFi composability and will be integrated into Avalon Labs DeFi lending. Isolated pools will be set up for different collaterals to borrow USDa at stable borrow rate.

<figure><img src="/files/gncGKYzkBdL1pIA0Ovs1" alt=""><figcaption></figcaption></figure>

## **Savings Account**

USDa can be deposited into Avalon savings account to get sUSDa. sUSDa is a yield bearing version of USDa. The yield is backed by USDa borrowing rates and revenue from USDaLend. For instance, borrowing USDa against BTC will incur a borrowing APR of 8%. And given 30% USDa is staked at saving account, up to 25% APR could be provided to sUSDa in a sustainable and scalable manner.

Formula to calcualte APR can be given as:

## $$APR\_{sUSDa} = \frac{TS\_{sUSDa}APR\_{USDa}-Fee}{TS\_{USDa}}$$

$$APR\_{sUSDa}$$: staking APR for sUSDa

$$APR\_{USDa}$$: borrowing APR for USDa

$$TS\_{sUSDa}$$: total supply of sUSDa

$$TS\_{USDa}$$: total supply of USDa

$$Fee$$: fee charged by Avalon Labs

AVL incentive will be dynamically allocated to incentivize USDa and sUSDa to achieve sUSDa staking ratio below 50% and a long term sustainable APR 15% of sUSDa.

$$StakingRatio\_{sUSDa} = \frac{TS\_{sUSDa}}{TS\_{USDa}}$$

## Unstaking sUSDa

Unstaking sUSDa requires a cooldown period of 7 days. DEX liquidity is provided for instant conversion.


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