How to use CeDeFi Lending
Borrowing Process
To borrow from CeDeFi Lending provided by Avalon, users follow these steps:
Supplying Collateral: Users deposit collateral into Avalon CeDeFi. Currently, collateral options include FBTC, with plans for expanding to more assets soon.
Requesting a Loan: Once collateral is deposited, users can request a stablecoin loan. The amount of USDT 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.
Claiming the Loan: Upon approval, users can claim their USDT loan within one business day.
Withdrawing Process
To withdraw collateral from CeDeFi Lending, users follow these steps:
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 The withdrawn amount must meet LTV requirements.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.
Claiming Collateral: Collateral can be claimed by users within one business day of initiating the withdrawal request.
Repayment Process
To repay a stablecoin loan, users can repay any desired amount up to the total borrowed amount, which includes both principal and interest.
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.
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