Lender

Lenders provide stable coins to the market to be borrowed. Lenders will collect payment plus interest and/or collect defaulted collateral after expiry.
  • The lender gives a loan by buying rcTokens from the borrower or a DEX pool (ex. Swapping Dai for rcTokens)

  • They receive rcTokens which represents the right to collect payments (ex. Dai) or forfeited collateral (ex. wBTC) after expiry.

  • After expiry, the lender can use the rcToken to collect payments and interests with Ruler Protocol in the form of the paired token (ex. Dai).

Lending

  • Lender gives a loan by buying rcTokens through the DEX pool

  • Lender receives rcTokens to represent the right to receive payment(s) and interest

Collect Payment & Interest

With rcTokens. A fee will be charged on the collected asset.

After expiry, lender can collect loan payment(s) and interest with rcTokens.

Collect on Default

With rcTokens. A fee will be charged on the collected assets.

If there is a default (the borrower does not payback the loan), the lender will return rcTokens to Ruler Protocol and collect the following assets proportionally with their share of the Ruler Pair:

  • Repayments from borrowers in the pair

  • Collateral defaulted in the pair

Taking Ruler Pair (wBTC, Dai, 12/31/2021, 10000) as an example.

  • 1 wBTC deposited for the pair, 10,000 rTokens minted

  • At expiry, only half of the RR_wBTC_10000_Dai_12_31_2021 are paid back (a default rate of 50%)

  • The pair now has 0.5 wBTC + 5000 Dai in the contract.

  • Each rcToken will be eligible to receive (0.5 wBTC + 5000 Dai) * (1 / 10,000)