diff --git a/docs/concepts/loopscale/asset-parameters.md b/docs/concepts/asset-parameters.md similarity index 92% rename from docs/concepts/loopscale/asset-parameters.md rename to docs/concepts/asset-parameters.md index b25ed4c..757d5fa 100644 --- a/docs/concepts/loopscale/asset-parameters.md +++ b/docs/concepts/asset-parameters.md @@ -1,22 +1,11 @@ --- -sidebar_position: 4 +sidebar_position: 5 --- -# Asset Parameters -Borrowers and lenders on Loopscale interact via virtualized Limit Creditbooks with standardized terms including principal and collateral options, principal and collateral oracles, and loan terms. These standardized terms are available below. More information on terms and how they affect a loan is available in [Protocol Concepts](/concepts/loopscale/asset-parameters). - -### Available Durations -- 1 day -- 1 week -- 1 month -- 3 months - -### Fees -To compensate lenders for an unused portion of a loan duration, borrowers are partial interest on any early repaid principal, expressed as a percentage of the original interest expected for the repaid principal. -**Early Repayment Penalty**: 50% of forgone interest +# Asset Parameters ## Principal -The following assets are eligible to be used as principal on Loopscale's vLCBs. +The following assets are eligible to be used as principal on Loopscale. Note that the most recent up to date list of assets can be found on the Loopscale App's [Borrow](https://app.loopscale.com/borrow) page. | Asset | Oracle | |:--|--:| |[USDC](https://solscan.io/token/EPjFWdd5AufqSSqeM2qN1xzybapC8G4wEGGkZwyTDt1v) |Gnt27xtC473ZT2Mw5u8wZ68Z3gULkSTb5DuxJy7eJotD | @@ -26,7 +15,9 @@ The following assets are eligible to be used as principal on Loopscale's vLCBs. |[BONK](https://solscan.io/token/DezXAZ8z7PnrnRJjz3wXBoRgixCa6xjnB7YaB1pPB263) |8ihFLu5FimgTQ1Unh4dVyEHUGodJ5gJQCrQf4KUVB9bN | |[WEN](https://solscan.io/token/WENWENvqqNya429ubCdR81ZmD69brwQaaBYY6p3LCpk)|6Uo93N83iF5U9KwC8eQpogx4XptMT4wSKfje7hB1Ufko | -## Collateral - +## Collateral +The following assets are eligible to be used as collateral on Loopscale. Note that the most recent up to date list of assets can be found on the Loopscale App's [Borrow](https://app.loopscale.com/borrow) page. + | Asset | LTV (%) | Liq. Ratio (%) | Oracle | |:--|--:|--:|--:| |[Solana](https://solscan.io/token/So11111111111111111111111111111111111111112)| 80|90|7UVimffxr9ow1uXYxsr4LHAcV58mLzhmwaeKvJ1pjLiE| diff --git a/docs/concepts/brand-kit.md b/docs/concepts/brand-kit.md new file mode 100644 index 0000000..012612d --- /dev/null +++ b/docs/concepts/brand-kit.md @@ -0,0 +1,16 @@ +--- +sidebar_position: 8 +draft: false +--- + +# Brand Kit + +If you're looking to report on or create content for Loopscale, you can make use of these brand assets. + +## Brand Kit: Logomark and Wordmark + +- [Brand Kit (SVG)](../../static/files/Loopscale_Brand_SVG.zip) +- [Brand Kit (PNG)](../../static/files/Loopscale_Brand_PNG.zip) + + + diff --git a/docs/concepts/faq.md b/docs/concepts/faq.md new file mode 100644 index 0000000..1197ba6 --- /dev/null +++ b/docs/concepts/faq.md @@ -0,0 +1,62 @@ +--- +sidebar_position: 9 +draft: false +--- + +# FAQ + +## About Loopscale + +### What is Loopscale? How is it different from other lending protocols? +Loopscale is a lending protocol built on Solana that uses order books instead of lending pools. Via Atomic Markets, lenders and borrowers match directly based on their preferred terms, rates, and collateral types. + +This approach eliminates the inefficiency of traditional lending pools, provides better rates, and supports any asset type without commingling risks across markets. + +Learn more about how Loopscale is different: [Why Loopscale](/concepts/why-loopscale). + +### What types of assets can be used on Loopscale? +Loopscale's architecture supports any token primitive, including those traditionally underserved by pool-based lending protocols. Loopscale allows for new assets to find lending markets without extensive governance processes or minimum liquidity requirements. + +See a full list of currently supported collateral on the [Loopscale App](https://app.loopscale.com/markets). + +### What is the history of Loopscale? +Loopscale evolved from Bridgesplit, which originally focused on building credit primitives for real-world assets. The team, upon seeing the same need for sophisticated lending primitives in crypto-native markets, pivoted and launched Loopscale in August 2024. + +### Has Loopscale raised funds? +Yes. In 2021, when Loopscale was known as Bridgesplit, the company raised $4.25M from CoinFund, Jump, Coinbase Ventures, Solana Ventures, and Room40. More information about this funding round is available in this [press release](https://www.businesswire.com/news/home/20211216005113/en/NFT-Financialization-Platform-Bridgesplit-Announces-4.25M-Raise-Led-by-CoinFund-and-Jump-Capital). + +### Has Loopscale been audited? +The core protocol underwent an audit in 2024, and a newer, more comprehensive audit is currently in progress. This new report will be published when Loopscale exits closed beta. + +### Is there a token or airdrop planned? +No token or airdrop plans have been announced. Users should be vigilant against scams. **Anyone claiming to offer a Loopscale token or airdrop is not legitimate**. + +## Using Loopscale + +### I'm having trouoble opening or closing a Yield Loop + +See the [Yield Loops](/concepts/using-loopscale/yield-loops#common-questions) article for answers to common questions and issues. + +### Why do I need to spend extra SOL to open a lending position or loop? +Opening a lending position or a loop effectively opens a new Solana account, which requires a "rent deposit." This extra amount of SOL is for this deposit. + +You will receive this "rent" back when you close your position fully. For lending positions, you may need to fully delete the position (positions can remain even after fully repaid) to reclaim the rent. See: [Managing lending positions](/concepts/using-loopscale/lend/managing-position). + +You can read more about rent and the Solana account model in the [Solana documentation](https://solana.com/docs/core/accounts). + +### How do fixed-rate loans work on Loopscale? +Fixed-rate loans on Loopscale maintain the same interest rate through a fixed term (e.g. 1 day, 1 week, 1 month, or 3 months). Unlike variable rate options common in traditional DeFi lending pools, there is no variable rate volatility for loans on Loopscale. + +### What occurs at the end of a fixed-duration loan term? +Upon reaching maturity, loans are automatically refinanced (re-opened at the same terms) at current market rates unless auto-refinancing has been disabled. Auto-refinancing can be disabled (or re-enabled) for any position via the Portfolio page. + +### Can I withdraw lent liquidity before the term ends? +Early withdrawals are available through the Portfolio page. When withdrawing early, the loan is sold at fair market value to the best available offer. The fair value calculation accounts for: +- Remaining interest on the loan +- Current market rates +- The new lender's target APY + +Interest earned up to that point is retained, with a small adjustment if the rate differs from current market rates. + +### How do I get support? +Support is available through the [Loopscale Discord](https://discord.gg/loopscale) by opening a support ticket. For issues related to using the platform, including a wallet address in the initial message allows the team to provide assistance more quickly. diff --git a/docs/concepts/index.mdx b/docs/concepts/index.mdx index de723dc..5e3c532 100644 --- a/docs/concepts/index.mdx +++ b/docs/concepts/index.mdx @@ -5,34 +5,36 @@ title: "Introduction" --- import {Products } from '@site/src/js-components'; -# What is Loopscale? -Loopscale is a new way to lend and borrow onchain with the best rates, any asset, and less risk. +# Introduction +**Loopscale** introduces a new standard for borrowing and lending onchain. DeFi lending has long been defined by the capital-inefficient pool model. Market maturity is exposing the limitations of this model, which emerged from Ethereum's architectural constraints. -Built on Solana, Loopscale uses order book-based architecture to combine the efficiency of direct market matching with the familiar user experience of traditional lending pools—without sacrificing scalability and flexibility. +Built on Solana, Loopscale uses order book-based architecture to combine the efficiency of direct market matching with the simplicity of traditional lending pools—without sacrificing scalability and flexibility. Rates are determined by markets, not algorithms, and any asset can be supported for principal and/or collateral, creating new liquidity for novel and emerging assets while deepening liquidity for existing assets. -## On Loopscale, users can: -- **Lend**: Supply capital to specific markets at preferred terms and rates while maintaining full control over collateral requirements. -- **Borrow**: Access fixed-rate loans using any collateral with superior rates and LTVs via market-based pricing. -- **Loop**: Enter into leveraged yield strategies, borrowing at low, fixed rates to lever up on yield-bearing tokens such as liquidity positions and liquid-staked SOL. + +## On Loopscale, users have access to the following: +- **Vaults**: Access passive lending exposure by depositing to Loopscale Vaults, each with a unique risk profile and strategy. +- **Yield Loops**: Enter into leveraged yield strategies, borrowing at low, fixed rates to lever up on yield-bearing tokens such as liquidity positions and liquid-staked SOL. +- **Borrowing**: Access fixed-rate loans using any collateral with superior rates and LTVs via market-based pricing. +- **Advanced Lending**: Supply capital to specific markets at preferred terms and rates while maintaining full control over collateral requirements. ## The advantages of using Loopscale over traditional lending protocols -1. **Best Rates**: Get the lowest borrowing rate and highest lending yields, made possible by unprecedented capital efficiency. +1. **Best Rates**: Get the lowest borrowing rate and highest lending yields, made possible by the capital efficiency of order books. 2. **More Collateral**: Use new collateral assets including native-staked SOL, NFT-based LP positions, memecoins, and real-world assets. 3. **Custom Risk Profiles**: Have custom risk exposure by controlling the assets you lend against. 4. **Fixed Rates**: Volatile rates can make strategies unprofitable. Fixed rates enable predictable returns for lenders and borrowers. ## The foundation for the next era of onchain finance While Loopscale begins with today’s DeFi-native markets, our infrastructure is purpose-built to power the next generation of onchain financial products. Loopscale enables use cases such as: +- Structured credit products utilizing the programmability of DeFi, from tranched pools to credit default swaps. - Receivables financing and undercollateralized lending that reflect real-world credit relationships, moving beyond algorithmic overcollateralization. +- Repurchase agreements for institutions to manage short-term, fixed-rate liquidity needs. - Cross-protocol margin infrastructure for asset management across multiple venues. - Credit facilities with parameters like custom repayment schedules. -- Structured credit products utilizing the programmability of DeFi, from tranched pools to credit default swaps. -- Repurchase agreements for institutions to manage short-term, fixed-rate liquidity needs. -The evolution of onchain lending—from overcollateralized DeFi loans to institutional credit markets—will demand infrastructure that scales. Loopscale is that infrastructure. +The evolution of onchain lending from overcollateralized DeFi loans to institutional credit markets will demand infrastructure that scales. Loopscale is that infrastructure. ## Keep up with Loopscale - Follow us on [X](https://x.com/LoopscaleLabs) diff --git a/docs/concepts/loopscale/_category_.json b/docs/concepts/loopscale/_category_.json deleted file mode 100644 index 40537e0..0000000 --- a/docs/concepts/loopscale/_category_.json +++ /dev/null @@ -1,6 +0,0 @@ -{ - "label": "Loopscale", - "position": 4, - "link": null, - "collapsed": false -} \ No newline at end of file diff --git a/docs/concepts/loopscale/borrowing.md b/docs/concepts/loopscale/borrowing.md deleted file mode 100644 index 3b4122f..0000000 --- a/docs/concepts/loopscale/borrowing.md +++ /dev/null @@ -1,51 +0,0 @@ ---- -sidebar_position: 2 ---- -# Borrowing -When borrowing on Loopscale, a user selects: -1. An asset and amount to borrow -2. How long they wish to borrow for -3. An asset and amount to use as collateral - -The list of available borrow assets, collateral assets, and loan duration options are available here. Each collateral asset has a loan-to-value ratio that determines the maximum borrowable amount. - -The borrower's receives funds at the lowest rate on the market and the collateral is escrowed. The collateral is returned to the borrower once the borrowed funds and accrued interest have been fully repaid. A borrower will default, losing their collateral, if: -1. The loan has not been fully repaid by the due date (Payment-Based Default) -2. The loan's health factor falls below 0% (Price-Based Default) - -To learn more about defaults and how health factor is calculated, see [Loan Health & Defaults](/concepts/loopscale/loan-health-management). - -A borrower has two ways to improve a loan's health factor: (1) topping up collateral (2) repaying a loan or portion of a loan early. - -## Topping-up Collateral -A borrower may deposit additional collateral for a loan, increasing the collateral value and increasing the health factor. The additional collateral must be of the same asset. Excess collateral may not be withdrawn until the loan conclusion with the rest of the collateral. - -## Repaying a loan -You can partially or fully repay a loan at any point. You only owe interest on loan value you have outstanding. So if you repay early, you won’t owe interest for the remaining time on the principal repaid. If you repay early, you will incur a fee that is proportional to the interest saved. This is to compensate the lender for locking their capital up and discourage long capital reservations without reason. - -### Early Repayment -A borrower may repay a loan in full before the loan due date. Upon repayment, the loan will end and the collateral will be returned to the borrower. - -A borrower may also partially repay a loan early, decreasing the loan value and increasing the health factor. - -#### Prepayment Penalty -Borrowers must pay 40% of the original interest for the unused time of a loan. In other words, interest is reduced by 60% for any early repaid loan amount. - -To illustrate the prepayment penalty, consider the following example: -1. The total interest due for 1-day, 40,000 USDC loan is 20 USDC (18.25% APY) -2. A borrower repays 10,000 USDC after 12 hours -3. After the full day has passed, borrower's total *interest* owed has three parts, for a total of 18.5 USDC (vs. 20 USDC): - 1. 18.25% APY on 40,000 USDC for the first 12 hours -> 10 USDC - 2. 18.25% APY on 30,000 USDC for the second 12 hours -> 7.5 USDC - 3. 40% of 18.25% APY on 10,000 USDC for the second 12 hours -> 1 USDC - -## Refinancing -One of the more powerful concepts for borrowers on Loopscale is the refinance. Refinancing is the process of repaying one outstanding loan by atomically starting another. The original lender is paid off and a new loan is started. - - - -Refinancing only works if there is an offer at a greater than or equal to size of the amount owed on a loan and for the corresponding term and collateral. The new loan is started at an amount equal to the original principal plus any accrued interest and fees for the new length. - -If the amount of collateral in the existing loan is insufficient to start aa new loan (e.g. Loan Balance > (LTV * Collateral)), the refinance will fail. - -Borrowers can opt-in to auto-refinancing which is an off-chain matching engine to find available offers automatically to renew loans instead of a payment based default. There is a 15 minute grace period post loan failure where the loan will attempt to be matched. \ No newline at end of file diff --git a/docs/concepts/loopscale/lending.md b/docs/concepts/loopscale/lending.md deleted file mode 100644 index c8c282c..0000000 --- a/docs/concepts/loopscale/lending.md +++ /dev/null @@ -1,27 +0,0 @@ ---- -sidebar_position: 3 ---- -# Lending -Lending on Loopscale is done through strategies, a lender deposits funds into a pool selecting: -1. Term Lengths you’re willing to lend for (1 day, 1 week, 1 month, 3 months) -2. Interest Rate you are willing to accept -3. Collateral you’re willing to lend against - -## Presets -Loopscale has a number of preset strategies to make the lending process even faster for quick borrowers. All presets set the max loan length to 1 month : -- Global: All Available Assets -- Core: Large Cap Solana tokens, LSTs, and other L1s -- DeFi: DeFi Governance tokens, LP positions, and vaults -- Memecoin: Large Cap Memecoins on Solana - -## After Creation -Once a strategy is created, an order will sit on the creditbook equal to the amount un-utilized balance of the strategy. Capital can be removed from the strategy if its unused and additional capital can be deployed to strategies. - -### Capital Management -Capital will be taken from the strategy to start new loans, once capital is deployed to a loan it is locked up for the length of the loan unless the borrower repays it early. - -### Defaults -In the event of a default (either due to late payment or price-based), liquidators will be able to purchase the collateral automatically at a value equal to the loan amount you’re owed and the funds will automatically be recycled into your strategy. If you would prefer to seize the collateral directly, you can turn off auto-liquidations in your strategy settings and take possession of the collateral directly. - -### Halting New Loans -If a lender wishes to stop new loans from being originated from their strategy, they can turn off new origination in strategy settings. \ No newline at end of file diff --git a/docs/concepts/loopscale/loan-health-management.md b/docs/concepts/loopscale/loan-health-management.md deleted file mode 100644 index e780945..0000000 --- a/docs/concepts/loopscale/loan-health-management.md +++ /dev/null @@ -1,30 +0,0 @@ ---- -sidebar_position: 4 -title: Health Factor & Defaults ---- - -# Defaults -If a loan defaults, the loan ends and the borrower loses ownership of the collateral, including excess collateral and early repayments. Loans on Loopscale have two default mechanisms, price-based and payment-based. - -## Price-Based Defaults -Similar to liquidations on existing DeFi lending protocols, price-based defaults occur when a loan's health factor reaches 0. In other words, a price-based default occurs when the value of loan's collateral relative to the value of the debt falls below the liquidation threshold. This can happen at any point during the loan, and borrowers should monitor their health factor to avoid a price-based default. Borrowers can increase their health factor by repaying principal and topping up collateral amounts. - - -### Health Factor -A loan's health factor helps a borrower easily understand a loan's real-time risk of a price-based. The health factor has a maximum value of 100%. A health factor of 0% signals a loan is at risk of liquidation, meaning its collateralization ratio no longer meets the liquidation threshold. - -The health factor is calculated with the following formula: - -$\text{Health Factor} = 1 - \displaystyle\frac{\text{Collateralization Ratio}}{\text{Liquidation Ratio}}$, where - - -$\text{Collateralization Ratio} = 1 - \displaystyle\frac{\text{Debt Value in USD}}{\text{Collateral Value in USD}}$ - - -and the $\text{Liquidation Ratio}$ is a per-collateral, protocol-determined value. ${\text{Debt Value}}$ includes the total interest as calculated at the loan due date. -The liquidation ratio is fixed for the lifetime of the loan whereas the collateralization ratio may fluctuate over the course of a loan as the value of the collateral or debt changes. - -Platform-wide liquidation ratio values can be found [here](./risk-management.md). - -## Payment-Based Defaults -Payment-based defaults result from a borrower failing to pay off outstanding debt by a loan's due date. Borrowers should monitor upcoming due dates to avoid a payment-based default. \ No newline at end of file diff --git a/docs/concepts/points.md b/docs/concepts/points.md new file mode 100644 index 0000000..87315de --- /dev/null +++ b/docs/concepts/points.md @@ -0,0 +1,33 @@ +--- +sidebar_position: 7 +--- + +# Points + +Users can earn rewards in the form of points earned through various interactions with the protocol. These points serve as a way to incentivize active participation and engagement with the Loopscale. Information on points and affiliated activities can be checked on the [Rewards](https://app.loopscale.com/rewards) page of the Loopscale App. Points have no present + +## How do points work? +Points are earned through active participation in the protocol, including: +- Lending assets +- Borrowing assets +- Yield Loops +- Referring new users (you will receive a portion of referred users' points) +- Participating in select activities (see the [Rewards page of the app](https://app.loopscale.com/rewards). + +### How many points are earned through these activities? +Users can see how many points a position would give per day via the Lend, Borrow, and Looping interfaces, below where users input the amount of an asset they are depositing, borrowing, or looping. + +Certain features have points multipliers. Mouse over the yellow or blue stars next to APYs on the Lend, Borrow, and Loop pages to see multipliers. + +### Do users earn points on idle liquidity? +Yes, points are earned on supplied assets even when they aren't actively being borrowed. This rewards providing market depth and supporting overall liquidity. + +### How do points from other protocols function within Loopscale? +Points can also be earned from other integrated protocols, indicated by the protocol's logo displayed alongside the blue points icon in the assets list on looping and borrowing pages. + +The Optimized Yield functionality automatically allocates unutilized lent capital to marginfi pools until matched with a borrower, providing marginfi points in this instance. + +These external protocols maintain responsibility for rewarding these points (e.g. users do not claim points from external protocols through Loopscale). + +## Referrals +Share your referral link (found on the app's [Rewards](https://app.loopscale.com/rewards) page) with others to earn additional points equal to 5% of how many points your referred user(s) earn. \ No newline at end of file diff --git a/docs/concepts/protocol-concepts/_category_.json b/docs/concepts/protocol-concepts/_category_.json index c978307..8f9820c 100644 --- a/docs/concepts/protocol-concepts/_category_.json +++ b/docs/concepts/protocol-concepts/_category_.json @@ -1,6 +1,6 @@ { "label": "Protocol Concepts", - "position": 3, + "position": 4, "link": null, - "collapsed": false + "collapsed": true } \ No newline at end of file diff --git a/docs/concepts/protocol-concepts/credit-order-book.md b/docs/concepts/protocol-concepts/credit-order-book.md new file mode 100644 index 0000000..0506136 --- /dev/null +++ b/docs/concepts/protocol-concepts/credit-order-book.md @@ -0,0 +1,25 @@ +--- +sidebar_position: 3 +--- +# Credit Order Book + +The Credit Order Book is the central primitive of Loopscale. It connects lenders and borrowers and facilitates efficient order matching, price discovery, and liquidity concentration. + +The Credit Order Book can be compared to order books found in traditional exchanges (e.g. stocks) and cryptocurrency exchanges. However, instead of price, the Credit Order Book advertises rates being offered by lenders to borrowers. + +![](../../../static/img/docs/concepts/limit-creditbook-1.png) + +On the Credit Order Book, borrowers and lenders can place orders for by defining individual [loan structures](/concepts/protocol-concepts/loans) offering maximal configurability. On Loopscale, borrowers and lenders primarily interact with the Order Credit Book via _virtualized_ Credit Order Books (vCOBs). A vCOB represents a collection of orders standardized on a subset of terms. + +The initial vCOBs on Loopscale standardize orders such that borrowers and lenders specify only principal, collateral, amount, rate, and duration and principal, collateral, and duration have a predefined set of options. This provides a streamlined experience and concentrates liquidity within unique combinations of principal, collateral, and duration. + +![](../../../static/img/docs/concepts/limit-creditbook-2.png) + +![](../../../static/img/docs/concepts/limit-creditbook-3.png) + +As liquidity grows, more vCOBs will be introduced with finer parameterization, balancing the trade-off between liquidity concentration and flexibility. + +## Order Matching +The Credit Order Book employs an on-chain matching engine to pair loan offers with loan requests. If an offer and request match across loan terms, the borrower may fill the lender offer, initialized the loan. + +Borrowers may also fill lender offers directly with matching collateral without creating a request. In this case, the borrower will fill the best-available order on the LCB as determined by the interest rate. \ No newline at end of file diff --git a/docs/concepts/protocol-concepts/limit-creditbook.md b/docs/concepts/protocol-concepts/limit-creditbook.md deleted file mode 100644 index 2c83cf4..0000000 --- a/docs/concepts/protocol-concepts/limit-creditbook.md +++ /dev/null @@ -1,17 +0,0 @@ ---- -sidebar_position: 1 ---- -# Limit Creditbook (LCB) - -The Creditbook serves as the as the central venue where lenders and borrowers interact via offers and requests. It is designed to facilitate efficient order matching, price discovery, and liquidity concentration. The Limit Creditbook (LCB) catalogs all borrower and lender orders and the virtualized Limit Creditbooks (vLCB) represents an abstraction designed to concentrate liquidity for a subset of markets. -![](../../../static/img/docs/concepts/limit-creditbook-1.png) -On the Limit Creditbook, borrowers and lenders can place orders for by defining individual [loan structures](/concepts/protocol-concepts/loans) offering maximal configurability. On Loopscale, borrowers and lenders primarily interact with the LCB via virtualized Limit Creditbooks. A vLCB represents a collection of orders standardized on a subset of terms. -The initial vLCBs on Loopscale standardize orders such that borrowers and lenders specify only principal, collateral, amount, rate, and duration and principal, collateral, and duration have a predefined set of options. This provides a streamlined experience and concentrates liquidity within unique combinations of principal, collateral, and duration. -![](../../../static/img/docs/concepts/limit-creditbook-2.png) -![](../../../static/img/docs/concepts/limit-creditbook-3.png) -As liquidity grows, more vLCBs will be introduced with finer parameterization, balancing the trade-off between liquidity concentration and flexibility. - -## Order Matching -The Creditbook employs an on-chain matching engine to pair loan offers with loan requests. If an offer and request match across loan terms, the borrower may fill the lender offer, initialized the loan. - -Borrowers may also fill lender offers directly with matching collateral without creating a request. In this case, the borrower will fill the best-available order on the LCB as determined by the interest rate. \ No newline at end of file diff --git a/docs/concepts/protocol-concepts/loans.mdx b/docs/concepts/protocol-concepts/loans.md similarity index 64% rename from docs/concepts/protocol-concepts/loans.mdx rename to docs/concepts/protocol-concepts/loans.md index e75217b..e484d1a 100644 --- a/docs/concepts/protocol-concepts/loans.mdx +++ b/docs/concepts/protocol-concepts/loans.md @@ -1,21 +1,43 @@ --- -sidebar_position: 3 +sidebar_position: 2 --- import { FixedTblCol } from "@site/src/js-components/inline"; # Loans + ## Introduction -Direct loans form the foundation of the Loopscale Protocol, enabling direct lending and borrowing between users. Lenders can create loan offers and borrowers can create loan requests with specific parameters such as interest rate, duration, and collateral requirements. When a matching counterparty accepts the offer or request, a bilateral loan is initialized, and funds are transferred between the parties. The collateral remains non-transferrable until the loan concludes, at which point it is returned to the borrower upon repayment or transferred to the lender in the event of a default. +Loans form the foundation of Loopscale, enabling direct lending and borrowing between users. Lenders can create loan offers and borrowers can create loan requests with specific parameters such as interest rate, duration, and collateral requirements. When a matching counterparty accepts the offer or request, a bilateral loan is initialized, and funds are transferred between the parties. The collateral remains non-transferrable until the loan concludes, at which point it is returned to the borrower upon repayment or transferred to the lender in the event of a default. + +A loan is created when a Lend Order matches with a compatible Borrow Order on the [Credit Order Book](/concepts/protocol-concepts/credit-order-book). + +## Orders +To create a more familiar experience for DeFi users, lenders place Lend Limit Orders and borrowers place Market Orders that match to the best priced Lending Limit Order. An order specifies terms of the requested loan, including: +- Principal (Asset, Max Amount) +- Collateral (Asset, Amount) +- Terms (Interest Rate, Repayment Schedule) +- Default Condition (Principal Oracle, Collateral Oracle, or Liquidation LTV) ## Offers and Requests Loans are initiated when a loan offer and loan request, collectively known as orders, are matched. Orders define the terms of a loan, including payment frequency, interest rate, principal, duration, and fees. Once created, orders are listed on the Limit Creditbook (LCB) and matched by an on-chain matching engine. Borrowers and lenders can also directly accept active orders on the LCB. When a suitable offer and request are matched, or when a borrower or lender finds an acceptable order, the borrower can initiate the loan. The protocol automatically transfers the principal to the borrower and escrows the collateral. -### Terms +## Ledgers +Initiating a loan automatically generates a repayment ledger based on the terms specified in the matched order. The ledger defines the repayment schedule and tracks repayments as they are made. The Loopscale Protocol uses this ledger to determine the current state of a loan. + +## Defaults +**Price-based defaults**: Similar to existing liquidation mechanics, a price-based default occurs when the value of collateral relative to the value of the principal falls below the liquidation threshold. This can happen at any point during the loan, and borrowers should monitor their health factor to ensure it doesn't get too close to zero. Borrowers can avoid liquidations by repaying principal and topping up collateral amounts. + +### Oracle Agnostic Pricing +Borrowers can set up loans that price their collateral or principal using custom or arbitrary oracles, enabling pricing for assets that may be illiquid or lack third-party oracle support. Loans may also be oracle-less, with borrowers proposing terms that solely default based on missed payments or loan expiry. + +## Terms +Below are all possible terms for a Loan via the Loopscale protocol. Note that not all of these terms are currently in use with the Loopscale App; but they do all exist within the protocol for current and future use cases. + + | | Description | |:---|:---| -| **Repayment type** | Simple-Interest loans have periodic interest payments with a final principal payment at maturity and Zero-Coupon loans have a single repayment that includes all interest and principal at maturity. | +| **Repayment type** | Simple-Interest loans have periodic interest payments with a final principal payment at maturity and Zero-Coupon loans have a single repayment that includes all interest and principal at maturity. | | **Principal** | The amount of principal being lent to the borrower. | | **Principal asset** | The currency of principal | | **Collateral** | The minimum amounts and mints of the collateral. | @@ -32,10 +54,3 @@ When a suitable offer and request are matched, or when a borrower or lender find | **Principal pricing oracle** | An optionally defined custom pricing oracle to calculate principal value | |**Collateral pricing oracle** | An optionally defined custom pricing oracle to calculate collateral value | -## Ledgers -Initiating a loan automatically generates a repayment ledger based on the terms specified in the matched order. The ledger defines the repayment schedule and tracks repayments as they are made. The Loopscale Protocol uses this ledger to determine the current state of a loan. -## Defaults -**Price-based defaults**: Similar to existing liquidation mechanics, a price-based default occurs when the value of collateral relative to the value of the principal falls below the liquidation threshold. This can happen at any point during the loan, and borrowers should monitor their health factor to ensure it doesn't get too close to zero. Borrowers can avoid liquidations by repaying principal and topping up collateral amounts. -**Payment-based defaults**: Payment-based defaults result from a borrower missing scheduled payments in excess of the pre-determined max outstanding payments, including the maturity payment. -### Oracle Agnostic Pricing - Borrowers can set up loans that price their collateral or principal using custom or arbitrary oracles, enabling pricing for assets that may be illiquid or lack third-party oracle support. Loans may also be oracle-less, with borrowers proposing terms that solely default based on missed payments or loan expiry. \ No newline at end of file diff --git a/docs/concepts/protocol-concepts/lockboxes.md b/docs/concepts/protocol-concepts/lockboxes.md deleted file mode 100644 index 821617a..0000000 --- a/docs/concepts/protocol-concepts/lockboxes.md +++ /dev/null @@ -1,23 +0,0 @@ ---- -sidebar_position: 2 ---- -# Lockboxes -A Lockbox escrows collateral for an individual loan for the duration of the loan. Lockboxes represent another significant difference between the Loopscale Protocol and other lending protocols. Unlike pool-based models where collateral is pooled and rehypothecated, collateral is deposited to the Lockbox, a loan-specific, programmatically-controlled account . Collateral on Loopscale is not rehypothecated and remains non-transferable for the duration of the loan. This approach offers two key benefits. - -## Collateral Eligibility -The absence of collateral segregation on other lending protocols limits the diversity of eligible collateral. - -Segregated collateral ensures the collateral risk for a particular loan is isolated to the lender, who may set collateral eligibility criteria and collateral-specific rates. In the event of a default, the collateral (or principal if liquidated) is returned to the lender. - -This means that any asset can be used as collateral so long as there is a willing lender. The Loopscale protocol supports complex collateral types including yield-bearing tokens such as natively staked SOL, liquidity provider positions such as Orca LP positions, and "real-world" assets such as tokenized funds or physical goods. - -## Minimized Risk -Pool-based models blend risk across all assets, making it more challenging to accurately price the risk associated with individual collateral assets. This approach has led to some of the most significant exploits in DeFi and results in substantial inefficiencies in pricing, as lenders must account for the risk of a diverse collateral base uniformly. An issue with one asset can have cascading effects across all assets, driving up the cost of borrowing against less volatile assets. - -Because collateral is segregated, liquidation risk is constrained to a single loan and non-rehypothecation eliminates the risk of liquidity mismatches. - -## Multi-Asset and Complex Asset Loans -Lockboxes also enable more complex collateral management including loans collateralized by multiple assets. Multi-asset collateral pricing is made possible because loans on are associated to a Lockbox and not any particular asset. - -Additionally, because the Lockbox is an on-chain account, it can also be delegated authority over other accounts. This means it can "store" assets such as exchange accounts or stake accounts. - diff --git a/docs/concepts/protocol-concepts/loops.md b/docs/concepts/protocol-concepts/loops.md new file mode 100644 index 0000000..1b0f5c1 --- /dev/null +++ b/docs/concepts/protocol-concepts/loops.md @@ -0,0 +1,36 @@ +--- +sidebar_position: 5 +--- + +# Loops + +## How Yield Loops work +Yield Loops work as follows, using the JupSOL-SOL loop as an example. +1. Loopscale borrows SOL with no collateral via a flash loan +2. SOL is swapped for more JupSOL +3. JupSOL is deposited as collateral in Loopscale +4. SOL is borrowed against the JupSOL collateral +5. Borrowed SOL repays the initial flash loan + +Loopscale executes these steps atomically. This means that all the above actions occur within a single transaction and revert if any step fails. + +The end result: a levered JupSOL position earning more yield as long as borrow rates are lower than the base JupSOL yield. + +Upon closing a Yield Loop, Loopscale does the following: +1. Flash loans the amount needed to repay your loan +2. Repays the long-term loan to free up your collateral +3. Sells enough of your yield-bearing asset to repay the flash loan +4. Returns the remaining assets to your wallet + +## Yield Loops compared to similar products + +While leveraged yield strategies have existed in DeFi before, Loopscale's order book architecture provides several key advantages over looping from traditional yield-based protocols. + +### Fixed rates rather than variable rates +Yield Loops use Loopscale's fixed-rate loans, protecting users from rate volatility that could turn profitable positions negative. Traditional pool-based protocols use variable rates that can spike during market stress, potentially forcing liquidations or making positions unprofitable when the borrow rate exceeds the yield from the underlying token. + +### Collateral-specific pricing +On Loopscale, lenders can set rates based on specific collateral quality rather than a uniform rate for an entire pool of different assets. This means borrowing against high-quality collateral like USDC is cheaper than borrowing against more volatile assets, resulting in more efficient pricing and better terms for safer positions. + +### Isolation prevents contagion +When using traditional pools for looping, volatility in one asset in a multi-asset pool can affect the entire protocol. Loopscale's Atomic Markets operate in complete isolation, so issues with one asset class don't impact others. This makes Yield Loops more resilient during market stress. \ No newline at end of file diff --git a/docs/concepts/protocol-concepts/offers_and_positions.md b/docs/concepts/protocol-concepts/offers_and_positions.md deleted file mode 100644 index 959ac64..0000000 --- a/docs/concepts/protocol-concepts/offers_and_positions.md +++ /dev/null @@ -1,42 +0,0 @@ ---- -sidebar_position: 4 -draft: true ---- -# Offers & Positions -## Offers -Loan offers (lend) and loan requests (borrow), collectively known as orders, are matched by the Creditbook matching engine. - -To improve the user experience for borrowers and lenders, t - - -Orders define the terms of a loan, in -Borrowers may create requests to be filled by a lender and lende - - -Borrowers place market orders (requests) via Virtual Creditbooks (vLCBs) which concentrate liquidity by standardizing terms across parameters like duration and collateral. Instead of placing individual limit orders (offers) on each vLCB, Positions enable lenders to reuse funds across orders on multiple vLCBs. - -## Positions -A Position is a principal balance deposited by a lender that fills market borrow orders according to parameters decided by the lender. - - -### Position Composition - - - -Loan to values are set application wide in the current version of Loopscale along with liquidation ratios, this is to standardize UX. Each asset has a preset maximum loan-to-value that borrows will be able to use and a preset liquidation ratio that loans will be subject to. - -## Strategy Composition -A strategy is composed of an escrow balance of idle principal which is waiting to be deployed and active loans. Active loan interest gets compounded into the strategy and after a loan is repaid, the funds are automatically made available for new loans. Strategies can be adjusted at any time. Funds can be added or removed from strategies as well. - -### Parameters -| Parameter | Description | -|:--|--:| -| Collateral | Multiple Selection, Opt In. Please see [link to params page] collateral page for a full list.| -| Duration |The maximum length of time a lender is willing to lock their funds| -| Rate |The interest rate you’re offering your funds at| - -## Strategies -Strategies are a tool for lenders to create lending positions with predefined terms. Each strategy uniquely defines a list of eligible collateral and a maximum duration. The current market rate is used for orders placed using a Strategy. - -By selecting a particular strategy, lenders only have to specify the amount of capital to deposit into the order. -y \ No newline at end of file diff --git a/docs/concepts/protocol-concepts/virtual-orderbooks.md b/docs/concepts/protocol-concepts/virtual-orderbooks.md deleted file mode 100644 index f2c0882..0000000 --- a/docs/concepts/protocol-concepts/virtual-orderbooks.md +++ /dev/null @@ -1,13 +0,0 @@ ---- -sidebar_position: 1 -draft: true ---- -# Virtual Orderbooks - -While there have been lending protocols supporting direct loans, many have failed to reach critical mass due to the fragmentation of liquidity inherent to one-to-one relationships. At launch, Loopscale abstracts the parameterization of loans, concentrating liquidity for direc loans across a series of standardized terms. Over time, more orderbooks will be introduced across more granular parameters. This approach enables short-term liquidity growth while preserving long-term flexibility. - -Yield Curve - Each market displays the minimum interest rate for each term length, this approximates a DeFi native “yield curve”. Although it is not a yield curve in the traditional sense, as loans maybe be repaid early with a fee, it gives borrowers a sense of how lenders value the principal asset over time. - -Market Specificity - Each market is defined by it’s Principal asset. Available borrowing term lengths are set across the platform per collateral. Collateral asset eligibility is determined by a lender on a per order basis. -Order Matching - If placed on the Creditbook, orders are set up by lenders and specify an APY, collateral they want to accept for the order, and term lengths they are willing to lend for. -Yield Curve - Each market displays the minimum interest rate for each term length, this approximates a DeFi native “yield curve”. Although it is not a yield curve in the traditional sense, as loans maybe be repaid early with a fee, it gives borrowers a sense of how lenders value the principal asset over time. \ No newline at end of file diff --git a/docs/concepts/loopscale/risk-management.md b/docs/concepts/risk-management.md similarity index 93% rename from docs/concepts/loopscale/risk-management.md rename to docs/concepts/risk-management.md index c28aea9..424d719 100644 --- a/docs/concepts/loopscale/risk-management.md +++ b/docs/concepts/risk-management.md @@ -1,8 +1,8 @@ --- -sidebar_position: 5 +sidebar_position: 6 --- # Risk Management -When using the Loopscale Protocol, it's important to understand and manage the financial and operational risks involved. THis page outlines key risks to consider and provides guidance on mitigating them. Some of these risks apply only to borrowers or only to lenders. +When using Loopscale, it's important to understand and manage the financial and operational risks involved. This page outlines key risks to consider and provides guidance on mitigating them. Some of these risks apply only to borrowers or only to lenders. ## Financial Risks ### Interest Rate Risk Interest rate risk arises from the potential for market rates to diverge from the fixed rate of your loan over time. Borrowing or lending at a fixed rate for a specific duration may result in your loan being more expensive or cheaper than the prevailing market rate. The sensitivity to interest rate changes increases with loan duration. diff --git a/docs/concepts/using-loopscale/_category_.json b/docs/concepts/using-loopscale/_category_.json new file mode 100644 index 0000000..08cefc5 --- /dev/null +++ b/docs/concepts/using-loopscale/_category_.json @@ -0,0 +1,6 @@ +{ + "label": "Using Loopscale", + "position": 3, + "link": null, + "collapsed": false +} \ No newline at end of file diff --git a/docs/concepts/using-loopscale/borrow/_category_.json b/docs/concepts/using-loopscale/borrow/_category_.json new file mode 100644 index 0000000..06a4112 --- /dev/null +++ b/docs/concepts/using-loopscale/borrow/_category_.json @@ -0,0 +1,6 @@ +{ + "label": "Borrowing", + "position": 3, + "link": null, + "collapsed": true +} \ No newline at end of file diff --git a/docs/concepts/using-loopscale/borrow/borrowing-assets.md b/docs/concepts/using-loopscale/borrow/borrowing-assets.md new file mode 100644 index 0000000..3e680db --- /dev/null +++ b/docs/concepts/using-loopscale/borrow/borrowing-assets.md @@ -0,0 +1,34 @@ +--- +sidebar_position: 1 +--- + +# Borrowing Assets + +Users can borrow tokens from Loopscale at superior fixed rates. The list of available tokens, collateral assets, and loan duration options are available on the [Loopscale App's Borrow page](https://app.loopscale.com/borrow). + +When borrowing on Loopscale, a user selects: + +- An asset and amount to borrow +- How long they wish to borrow for (locking in an interest rate for this duration) +- An asset its amount to use as collateral + +Each collateral asset has a loan-to-value (LTV) ratio that determines the maximum borrowable amount as well as a liquidation LTV that determines at what LTV the position's health reaches 0%, leading to liquidation. + +The borrower receives funds at the lowest rate on the market and the collateral is escrowed. The collateral is returned to the borrower once the borrowed funds and accrued interest have been fully repaid. + +A borrower will default, losing their collateral the loan's health factor falls below 0%. To learn more about health factor, see [Managing Loans](/concepts/using-loopscale/borrow/managing-loans). + +## Quick borrow + +The easiest way to borrow on Loopscale is to go to the [Borrow](https://app.loopscale.com/borrow) and click "Borrow" next to the token you wish to borrow. Then: + +1. Choose your collateral and its amount +2. Select how safe or aggressive you wish to be with your LTV (click "Show more" to see more stats like health and liquidation price) +3. Click "Borrow" to open up a borrow position. Through this interface, Loopscale borrows at a 24 hour fixed rate. + +## Advanced borrow + +By instead clicking "View market" next to a token on the [Borrow](https://app.loopscale.com/borrow) page, users can access a more advanced borrow interface. + +In this interface, users can select their fixed rate period. Longer fixed rates mean more stability, but can require a higher rate as a result (depending on offers from lenders in the order book). + diff --git a/docs/concepts/using-loopscale/borrow/lp-collateral-management.md b/docs/concepts/using-loopscale/borrow/lp-collateral-management.md new file mode 100644 index 0000000..e34331b --- /dev/null +++ b/docs/concepts/using-loopscale/borrow/lp-collateral-management.md @@ -0,0 +1,20 @@ +--- +sidebar_position: 3 +--- + +# LP Collateral Management + +Users are able to manage their Orca Whirlpool liquidity positions directly from the Loopscale app while these positions are being used as collateral. + +## How to manage LP collateral + +1. Navigate to the [Portfolio](https://app.loopscale.com/portfolio) page of the app and find your borrow position that uses Orca Whirlpool LP tokens as collateral. +2. Click "Manage "Manage whirlpool" to open up the interface for adjusting your liquidity position. +3. Here, you can adjust your liquidity range and position balances as well as harvest yield from the position to your wallet. + +## Tips on LP collateral management + +When adjusting position balances, it's important to note how it will affect your loan health. Withdrawals from the position will not succeed if they reduce health below the minimum health ratio. + +You can also modify slippage for liquidity management transactions by clicking the icon at the top right of the interface. + diff --git a/docs/concepts/using-loopscale/borrow/managing-loans.md b/docs/concepts/using-loopscale/borrow/managing-loans.md new file mode 100644 index 0000000..63261d4 --- /dev/null +++ b/docs/concepts/using-loopscale/borrow/managing-loans.md @@ -0,0 +1,59 @@ +--- +sidebar_position: 2 +--- + +# Managing Loans + +A loan is created when a borrow order matches with a compatible lend order. The Loopscale App provides several features to manage your loans. Users can see their ongoing loans on the Loopscale App's [Portfolio](https://app.loopscale.com/portfolio) page, under the Borrowing section. + +**Loan Health** indicates how far a loan is from potential liquidation. It ranges from 0% to 100%, with 0% meaning the loan is at risk of liquidation because its collateralization ratio has fallen below the required threshold. Borrowers should regularly monitor loan health, especially when collateral value fluctuates. Starting with a lower loan-to-value ratio (LTV) will give your loan a higher initial health percentage. + +To improve a loan's health factor, borrowers can: +1. Add more collateral +2. Repay part of the loan early + +Borrowers may also repay a loan completely before its due date. Upon full repayment, the loan closes and all collateral returns to the borrower. Partial early repayments reduce the outstanding loan amount and increase the health factor. Any early repayment includes interest accrued up to that point. + +## Loan Management Actions + +Users can perform the following actions on their ongoing loans from the Portfolio or Borrow pages: + +### Borrow More +Increase your loan amount using existing collateral by finding your position in your portfolio, clicking More, and selecting "Borrow More." This does not add additional collateral and will decrease your loan health. + +### Withdraw Collateral +Remove some collateral from your position by finding it in your portfolio, clicking More, and selecting "Withdraw Collateral." This action reduces loan health. + +### Top Up Collateral +Add more of the same collateral asset to your loan to increase the health factor. Note that any added collateral cannot be withdrawn until the loan concludes. + +### Refinancing +Borrowers can refinance their loans by repaying an outstanding loan while simultaneously starting another. This pays off the original lender and creates a new loan. + +Refinancing requires: +- An available offer of equal or greater size than the amount owed +- Matching term and collateral requirements +- Sufficient collateral value to meet the new loan's LTV requirements + +The new loan amount will equal the original principal plus any accrued interest and fees for the new term. + +Borrowers can opt into auto-refinancing, which uses an off-chain matching engine to find available offers automatically. There is a 15-minute grace period after loan failure during which the system attempts to find a match. + +## Understanding Loan Health +The health factor helps you understand your loan's real-time risk of liquidation. It is calculated using: + +$\text{Health Factor} = 1 - \displaystyle\frac{\text{Collateralization Ratio}}{\text{Liquidation Ratio}}$ + +Where: +- $\text{Collateralization Ratio} = \displaystyle\frac{\text{Debt Value in USD}}{\text{Collateral Value in USD}}$ +- $\text{Liquidation Ratio}$ is a protocol-determined value specific to each collateral type +- $\text{Debt Value}$ includes the total interest calculated at the loan due date + +The liquidation ratio remains fixed for the lifetime of the loan, while the collateralization ratio may change as collateral or debt values fluctuate. + +You can find current liquidation ratio values at the bottom of the [Loopscale App's Borrow page](https://app.loopscale.com/borrow). + +## Defaults +If a loan defaults, it ends and the borrower loses ownership of all collateral, including excess collateral and any partial repayments. + +**Price-based defaults** occur when a loan's health factor reaches 0% - meaning the collateral value relative to the debt falls below the liquidation threshold. This can happen at any point during the loan term. Borrowers should monitor their health factor to avoid this type of default. \ No newline at end of file diff --git a/docs/concepts/using-loopscale/lend/_category_.json b/docs/concepts/using-loopscale/lend/_category_.json new file mode 100644 index 0000000..8989dc4 --- /dev/null +++ b/docs/concepts/using-loopscale/lend/_category_.json @@ -0,0 +1,6 @@ +{ + "label": "Advanced Lending", + "position": 4, + "link": null, + "collapsed": true +} \ No newline at end of file diff --git a/docs/concepts/using-loopscale/lend/lending-assets.md b/docs/concepts/using-loopscale/lend/lending-assets.md new file mode 100644 index 0000000..3dcf584 --- /dev/null +++ b/docs/concepts/using-loopscale/lend/lending-assets.md @@ -0,0 +1,51 @@ +--- +sidebar_position: 1 +--- + +# Lending Assets + +Lending on Loopscale is different from pool-based lending protocols. It can be compared most to limit order book-based exchanges. On Loopscale, lending creates a limit order on the Credit Order Book of a) amount offered and b) APY requested on that amount. Borrowers then select the best APY (in what can be compared to a market order). + +## How to lend on Loopscale +There are two ways to Lend on Loopscale: + +1. Lend through **Loopscale Vaults**, where capital is deposited to vaults where lending positions are managed by a vault custodian. This is a more passive approach to lending; to learn more, see [Loopscale Vaults](/concepts/using-loopscale/vaults). + +2. Lend through **Advanced Lending**, specifying rates and eligible collateral. This is a more complex—and more powerful—way to lend. **This article describes how to create these positions**. + +## How to create an Advanced Lending position on Loopscale + +First, navigate to the [Lend page on the Loopscale App](https://app.loopscale.com/lend). Find the asset you want to lend and click "View market" for that asset. From here, you select which asset you wish to supply (lend), collateral you accept, and the APYs you request for each fixed rate duration. + +### Eligible collateral selection + +Loopscale allows for lenders to specify which collaterals they'll accept. This helps lenders price risk better. + +For example, lenders may only accept stablecoins as collateral and thus charge lower APYs, whereas lenders accepting memecoins as collateral can request higher APYs in return for the increased collateral risk. + +Loopscale has a number of preset strategies to make the lending process even faster for quick borrowers. + +### Target APY + +In this section, lenders specify their offered rates for 1 day, 1 week, 1 month, and 3 month fixed-rate, fixed-duration loans. + +For example, asking for 5% APY on USDC for 1 month means a borrower who accepts this lend offer will borrow the lender's USDC at 5% APY, and that rate will be locked in for one month. + +Interest rates on Loopscale are market-driven, meaning they're set by lenders and accepted by borrowers directly. This creates more efficient pricing compared to pool-based models where rates are determined by utilization. + +When setting rates, consider current interest rates on the order book. More competitive rates will be utilized sooner. Longer term lengths typically command higher interest rates. + +### Lend idle capital + +Loopscale's _Optimized Yield_ deposits lent capital into partnered pool-based lending protocols (currently marginfi) so this capital can earn yield while it awaits being matched to a borrower. This feature is optional. + +Most users elect to use the vaults to earn yield without having to consider lending strategies; in the rest of this article, custom lending strategies will be discussed. + +### A note on Rent +If this is your first time lending a certain asset (or you deleted a past position entirely), you will need to pay a small SOL fee for rent (in addition to the network fee). This fee will be reclaimed upon completely closing out your lending position. + +## After position creation +Once a strategy is created, an order will sit on the Credit Order Book equal to the amount un-utilized balance of the position. Capital can be removed from the strategy if its unused and additional capital can be deployed as well. + +From here, see: [Manage Position](/concepts/product/lend/lending-assets). + diff --git a/docs/concepts/using-loopscale/lend/managing-position.md b/docs/concepts/using-loopscale/lend/managing-position.md new file mode 100644 index 0000000..7b3e23c --- /dev/null +++ b/docs/concepts/using-loopscale/lend/managing-position.md @@ -0,0 +1,49 @@ +--- +sidebar_position: 2 +--- + +# Managing Lending Positions + +This article explains how to manage your lending positions. + +## View Lending Positions + +You can view and modify your lending positions in two places: +1. On the Portfolio page, under the advanced lending positions section +2. At the bottom of the [Lend](https://app.loopscale.com/market/USDC?role=lend) page + +## Withdraw + +Unutilized portions of a lending position can be withdrawn immediately by clicking "Deposit/Withdraw" and selecting "Withdraw." + +You can see how much of a position is currently in use in the Utilization field. + +## Withdrawing Early + +To withdraw from an active loan before its due date (collecting partial interest): +1. Go to your position +2. Click "More" +3. Select "View Loans" +4. Choose "Withdraw Early" from the active loan(s) + +## Capital Management + +New loans will use capital from your lending strategy. Once capital is deployed to a loan, it remains locked for the duration of the loan unless the borrower repays early. + +## Defaults + +If a default occurs, liquidators can purchase the collateral automatically at a value equal to the loan amount you're owed, and funds will be returned to your lending position. + +If you prefer to receive the collateral directly, you can disable auto-liquidations in your strategy settings to take possession of the collateral instead. + +## Halting New Loans + +To stop new loans from being created from your lending position: +1. Turn off new origination in strategy settings +2. Your funds will remain in the lending position but won't be used for new loans after current loans end + +## Closing a Position and Reclaiming Rent + +Even after withdrawing all funds, your position remains open so you don't need to pay rent again if you reopen it. To close the position completely and receive your rent SOL back: +1. Click "More" +2. Select "Delete position" \ No newline at end of file diff --git a/docs/concepts/using-loopscale/vaults.md b/docs/concepts/using-loopscale/vaults.md new file mode 100644 index 0000000..007c256 --- /dev/null +++ b/docs/concepts/using-loopscale/vaults.md @@ -0,0 +1,53 @@ +--- +sidebar_position: 1 +--- + +# Loopscale Vaults + +**Loopscale Vaults** are the easiest way to earn lending yield on Loopscale. They simplify the lending experience by delegating management of rates, durations, and collateral selections to dedicated **Vault Curators**. + +Vaults can be found at the top of the [Lend](https://app.loopscale.com/lend) page of the Loopscale App. + +When you deposit into a Vault: +1. You deposit into a managed pool overseen by a Vault Curator. +2. The Curator supplies these tokens across Loopscale's modular lending markets, managing rates, durations, and collateral sections while aligning to a yield and risk management strategy. +3. Vaults generate returns from interest paid by borrowers borrowing from underlying markets. +3. These returns flow back to all vault depositors proportionally. + +Loopscale's first Yield Vaults are managed by the Loopscale core team, but Loopscale will soon onboard third-party risk experts to manage their own vaults. + +Vaults are designed to provide for instant deposits and withdrawals; the latter is made possible by a small percentage of deposits kept idle for withdrawal liquidity. See _Liquidity Buffer_ under _Market Parameters_ below. + +Deposits in Vaults can serve as collateral for further borrowing, making possible further composability and leveraged strategies. + +## Vault Interface + +Each Vault's page lists its statistics, ongoing loans, and market parameters. + +### Loans + +The Loans section of the vault page details how the Vault's token (e.g. SOL for a SOL Vault) is being borrowed. It lists allocations of the Vault token, its APYs, and well the tokens provided by borrowers as collateral. + +### Market parameters + +**Liquidity buffer**: This is the percentage of Vault deposits kept idle so that they may be used to fill withdrawals. No lending offers will be placed if idle liquidity is below this buffer. If the vault has low liquidity for withdrawals, users can choose between an instant withdrawal with a small fee or to join a withdrawal queue. + +**Max loan size**: The max loan size (denominated in the Vault's deposit) allowed. + +**Collateral**: A list of collateral that the Vault accepts, and each collateral's APY, LTV, and liquidation LTV. This is a major aspect of a Vault's risk management strategy. + +## Vault security and restrictions +Vaults have been [audited]](/concepts/faq#has-loopscale-been-audited), and Vault Curators cannot withdraw deposits from the Vault. + +The vault manager can update APYs, durations, or origination fees at any time. All other changes, such as permitted collateral, require a 24 hour waiting period. + +## Use cases for Vaults + +Vaults abstract away the complexities of fixed-rate, order book-based lending by pooling user deposits under management by Vault Curators. This provides both a simpler user experience while also allowing for Curators to provide optimize yield with appropriate risk parameters. + +Loopscale allows for each Vault to have specific strategies, risk profiles, and goals in mind. One Vault may focus solely on highly liquid and low-risk assets, aiming for steady and predictable returns. Another Vault might pursue more aggressive strategies, lending to higher-risk, higher-yield opportunities like leveraged trading positions, or liquidity positions to maximize returns. + +## Vaults vs. advanced lending +Vaults offer simplified lending where Curators manage your deposits across markets, providing convenience at the cost of lower potential returns and less control. Users simply deposit funds and receive interest without managing rates, durations, or collateral choices. + +In contrast, [Advanced Lending](/concepts/lend/lending-assets) gives experienced users direct control with flexible collateral options, and customizable risk parameters. This approach requires active management and more capital, but can be rewarding for users who wish to pursue a more nimble or specific strategy. Your choice depends on whether you prioritize convenience or maximizing returns through hands-on management. \ No newline at end of file diff --git a/docs/concepts/using-loopscale/yield-loops.md b/docs/concepts/using-loopscale/yield-loops.md new file mode 100644 index 0000000..4634ec7 --- /dev/null +++ b/docs/concepts/using-loopscale/yield-loops.md @@ -0,0 +1,62 @@ +--- +sidebar_position: 2 +--- + + +# Yield Loops + +Yield Loops are a structured product offering access to leveraged yield strategies. They enable users to multiply returns from yield-bearing assets like JLP, native and liquid-staked Solana, and more. Yield Loops can either be market-neutral or short/long biased. + +A Yield Loop uses deposited tokens as collateral to borrow more of the same yield-bearing asset. This creates a loop where both the initial deposit and the borrowed tokens earn yield, amplifying returns. + +Loopscale's fixed-rate loans are used for Yield Loops. These fixed rates protect against rate spikes that could turn profitable positions negative, a notable consideration for when these positions are leveraged. + +Learn more about the underlying mechanics of Yield Loops [here](/concepts/protocol-concepts/loops). + +## Create a position + +To create a Yield Loop position: + +1. Navigate to the [Loops page](https://app.loopscale.com/loops) on the Loopscale App +2. Select a Yield Loop from the available categories (Long/short, leveraged staking, LPs, etc.). Note whether the position is biased long or short, or if it leverages staking or stablecoin yields instead (and thus is neutral to market price movements). +3. Choose your leverage amount, noting how it affects both yields as well as health and liquidation price. +4. Optionally, select slippage limits and a custom fixed rate duration (higher durations protect from rate volatility, but typically command higher borrow rates). +5. Approve and execute the transaction. + +## Managing a position + +It's important to monitor a Yield Loop position's health to avoid liquidation, particularly for positions with a long or short bias. The Loopscale interface provides metrics to help you track a position: +- Current leverage +- Liquidation threshold +- Projected returns based on current yield rates + +Users have the option of topping up collateral on a Yield Loop. This effectively deleverages the position and improves the health of the Yield Loop. This can be useful to do if a Yield Loop is approaching liquidation. + +You can see your current positions either on an individual Yield Loop's page or in the [Portfolio](https://app.loopscale.com/portfolio) page of the app. + +Learn more about managing loan health here: [Managing Loans](/concepts/using-loopscale/borrow/managing-loans). + +## Closing a position + +When you're ready to close a Yield Loop: + +1. Find your Yield Loop position: Go to the [Loops page](https://app.loopscale.com/loops), select your loop, and find your position—or, go to the active positions in the Loops section of the [Portfolio](https://app.loopscale.com/portfolio) page. +2. Select the position you wish to close and close it. + +## Common questions + +### On trying to open a Loop, I see the error "Market does not have enough SOL supplied" +Yield Loops require a swap via AMM (e.g. Orca, Raydium) to open a position. The "not enough SOL supplied" error means that there is not enough liquidity in the AMM's liquidity pool for the amount of token being looped. Try decreasing leverage or choosing another Loop. + +### "No Route Found" error on closing a Loop +This means that there isn't enough liquidity in the Loop token's AMM pool to close the loop. You can repay the loop directly using SOL if you don't want to wait for the pool to acquire more liquidity. + +## Yield Loop Risk Considerations + +When using Yield Loops, be aware of these risk factors: + +1. **Asset price volatility**: Significant price drops can lead to liquidation, notably when in long or short-biased Yield Loops. +2. **Rate volatility**: If the yield of your asset drops below your borrowing rate, your position may become unprofitable. Choosing longer fixed rate durations can help address this (but will typically require a higher borrow rate). Loopscale mitigates rate volatility risk through fixed-rate loans, but users should still approach leveraged strategies with appropriate caution. +3. Additional risks outlined on the [Risk Management](concepts/product/risk-management) page. + + diff --git a/docs/concepts/why-loopscale.md b/docs/concepts/why-loopscale.md index 301b932..8339d76 100644 --- a/docs/concepts/why-loopscale.md +++ b/docs/concepts/why-loopscale.md @@ -4,7 +4,7 @@ sidebar_position: 2 # Why Loopscale? -Before exploring Loopscale's new primitives and advantages, let's understand how traditional, pool-based lending protocols work and their limitations. +Before exploring Loopscale's advantages and new primitives, let's understand how traditional, pool-based lending protocols work—as well as their limitations. ## The problem with pool-based lending In the first generation of DeFi lending protocols, the borrowing interest rate is determined by the utilization of the asset. This model is known as a pool- or utilization-based model. As illustrated in the chart below, when utilization increases, borrowing is discouraged and supplying is encouraged. This design decision was made to maintain excess liquidity for withdrawals. @@ -24,7 +24,7 @@ This design creates several fundamental inefficiencies: 4. **Limited asset support**: New assets need deep pool liquidity to launch, leaving many novel and emerging assets (like yield-bearing tokens) underserved. ## A better solution: The Credit Order Book -Loopscale's order book model—featuring the Credit Order Book—matches individual lenders and borrowers based on flexible criteria such as asset type, amount, duration, and interest rate. This creates Atomic Markets where: +Loopscale's order book model—the Credit Order Book—matches individual lenders and borrowers based on flexible criteria such as asset type, amount, duration, and interest rate. We call our order book-based markets **Atomic Markets**, where: - Lenders and borrowers define the terms - Each market has specific parameters and risk pricing - Any asset can be used as collateral, unlocking potentially trillions in novel and emerging assets diff --git a/static/files/Loopscale_Brand_PNG.zip b/static/files/Loopscale_Brand_PNG.zip new file mode 100644 index 0000000..972fdaa Binary files /dev/null and b/static/files/Loopscale_Brand_PNG.zip differ diff --git a/static/files/Loopscale_Brand_SVG.zip b/static/files/Loopscale_Brand_SVG.zip new file mode 100644 index 0000000..40fe2c7 Binary files /dev/null and b/static/files/Loopscale_Brand_SVG.zip differ