Collateral Ratios

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                                                    Some of the information on this page is no longer applicable.
                                                  
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                                                    Originally, the redeem function was suspended. A proposal to allow redemption CoUSD is up for vote as of June 21, 2022.
                                                  
                                                    https://coffinfinance.medium.com/cousd-redeem-proposal-4e4417d84b90
                                                  
                                                    https://snapshot.org/#/coffinfinance.eth/proposal/0x893abc649be05e5613a41dbc0885f7ae9a7d08fd9d955170feac7ccc082995a8
                                                  
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                                          2 Type of Collateral Ratios. 
                                          
                                          There are 2 types of collateral ratios. There are Effective Collateral Ratio (ECR) and Target Collateral Ratio (TCR) .
                                        
                                          The ECR is based on the actual collateral ratio. The TCR is just a target ratio based on historical CoUSD prices.
                                        
                                          There various configurations, to successfully launch and keep the system, only the development team is responsible for maintaining and, and adjusting them. If you dislike, you are more than welcome to raise the issues and vote after governance is released.
                                        
                                          TCR for Minting 
                                          
                                          The system tries to peg CoUSD to be equivalent to $1.00 USD, but the collateral ratios for minting and redemption are sometimes different.
                                        
                                          Minting enables us to create new CoUSD tokens from FTM and COFFIN. The COFFIN token will be burned in this process, while the FTM will be used as collateral. The ratio depends on the current TCR by default. This ratio is updated every 60 minutes and up (by default) .
                                        
                                          When updating the TCR, the system checks the current CoUSD value in USD. If the value is above peg, the TCR will slightly decrease. If the value is below peg, the TCR will slightly increase.
                                        
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                                          ECR for Redeeming 
                                          
                                          CoUSD is entitled to the same percentage of collateral ratio, regardless of what collateral rates they were minted at. By default, the system uses the ECR as collateral ratio for redeeming.
                                        
                                          ECR Formula
                                          
                                          The CoUSD consists of Collateral and COFFIN. The formula is as below.
                                        
​
                                            
                                                  F
                                                
                                                  =
                                                
                                                        (
                                                      
                                                        Y
                                                      
                                                        ∗
                                                      
                                                          P
                                                        
                                                          y
                                                        
                                                        )
                                                      
                                                      ⏞
                                                    
                                                    collateral value
                                                  
                                                  +
                                                
                                                        (
                                                      
                                                        Z
                                                      
                                                        ∗
                                                      
                                                          P
                                                        
                                                          z
                                                        
                                                        )
                                                      
                                                      ⏞
                                                    
                                                    COFFIN value
                                                  
                                                F = \overbrace{(Y*P_y)}^{\text{collateral value}} + \overbrace{(Z*P_z)}^{\text{COFFIN value}}
                                              
                                            F=(Y∗Py​)
                                            
                                            ​collateral value​+(Z∗Pz​)
                                            
                                            ​COFFIN value​
                                          
​
​
                                            
                                                  (
                                                
                                                  1
                                                
                                                  −
                                                
                                                    C
                                                  
                                                    r
                                                  
                                                  )
                                                
                                                  (
                                                
                                                  Y
                                                
                                                  ∗
                                                
                                                    P
                                                  
                                                    y
                                                  
                                                  )
                                                
                                                  =
                                                
                                                    C
                                                  
                                                    r
                                                  
                                                  (
                                                
                                                  Z
                                                
                                                  ∗
                                                
                                                    P
                                                  
                                                    z
                                                  
                                                  )
                                                
                                                (1-C_r)(Y*P_y) = C_r(Z*P_z)
                                              
                                            (1−Cr​)(Y∗Py​)=Cr​(Z∗Pz​)
                                          
​
                                            
                                                  F
                                                
                                                F
                                              
                                            F
                                          
is the units of CoUSD
                                            
                                                    C
                                                  
                                                    r
                                                  
                                                C_r
                                              
                                            Cr​
                                          
is the collateral ratio
                                            
                                                  Y
                                                
                                                Y
                                              
                                            Y
                                          
is the units of collateral transferred to the system
                                            
                                                    P
                                                  
                                                    y
                                                  
                                                P_y
                                              
                                            Py​
                                          
is the price in USD of
                                            
                                                  Y
                                                
                                                Y
                                              
                                            Y
                                          
as collateral. We use FTM for
                                            
                                                  Y
                                                
                                                Y
                                              
                                            Y
                                          
.
                                            
                                                  Z
                                                
                                                Z
                                              
                                            Z
                                          
is the units of COFFIN
                                            
                                                    P
                                                  
                                                    z
                                                  
                                                P_z
                                              
                                            Pz​
                                          
is the price in USD of COFFIN

                                                        ​
                                                      
                                                        Y
                                                      
                                                        =
                                                      
                                                            F
                                                          
                                                            ∗
                                                          
                                                            (
                                                          
                                                              C
                                                            
                                                              r
                                                            
                                                            )
                                                          
                                                            P
                                                          
                                                            y
                                                          
                                                        ​
                                                      
                                                      ​Y = \dfrac{F*(C_r)}{P_y} ​
                                                    
                                                  ​Y=Py​F∗(Cr​)​​
                                                
                                                        ​
                                                      
                                                        Z
                                                      
                                                        =
                                                      
                                                            F
                                                          
                                                            ∗
                                                          
                                                            (
                                                          
                                                            1
                                                          
                                                            −
                                                          
                                                              C
                                                            
                                                              r
                                                            
                                                            )
                                                          
                                                            P
                                                          
                                                            z
                                                          
                                                      ​Z = \dfrac{F*(1-C_r)}{P_z}
                                                    
                                                  ​Z=Pz​F∗(1−Cr​)​
                                                
​
                                            
                                                  F
                                                
                                                F
                                              
                                            F
                                          
is the units of CoUSD redeemed
                                            
                                                    C
                                                  
                                                    r
                                                  
                                                C_r
                                              
                                            Cr​
                                          
is the collateral ratio
                                            
                                                  Y
                                                
                                                Y
                                              
                                            Y
                                          
is the units of collateral transferred to the user
                                            
                                                    P
                                                  
                                                    y
                                                  
                                                P_y
                                              
                                            Py​
                                          
is the price in USD of
                                            
                                                  Y
                                                
                                                Y
                                              
                                            Y
                                          
collateral
                                            
                                                  Z
                                                
                                                Z
                                              
                                            Z
                                          
is the units of COFFIN minted to the user
                                            
                                                    P
                                                  
                                                    z
                                                  
                                                P_z
                                              
                                            Pz​
                                          
is the price in USD of COFFIN

                                          Oracle Prices
                                          
                                          For TCR & ECR, the oracle price is not measured through use of TWAP, but the same system use for the realtime price by the SpookySwap Pair Contract.
                                        
                                          Please have a look at below page about the Price Oracle:
                                        
                                                  Price Oracles
                                                
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                                                    NOTE: These examples do not account for the minting and redemption fees, which are set between 0.30% and 0.50%. Basically, the minting fee is 0.30% ; 0.50% is for redeeming. 
                                                    
                                                    Disclaimer : Basically, Once Smart Contract is deployed, it’s hard to adjust/change the contract itself. However, we tried to allow for some system flexibly. To keep the stability of CoUSD, the development team will continue to make adjustments to maintain the integrity of the token, until this is now longer required the further we grow and the more capital that flows through the protocol. We would like all investors to be aware of this.
                                                  
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                                                  Circuit Breakers
                                                
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                                                    We highly recommend you to Do Your Own Research and never use funds within Coffin Finance that you cannot afford to lose. You won’t be compensated for any losses. All interactions with the associated smart contracts on the Fantom Opera and software on Coffin Finance are at your own risk.
COFFIN staking for xCOFFIN
Governance and xCOFFIN
Last modified 7mo ago
Collateral Ratios

2 Type of Collateral Ratios.

TCR for Minting

ECR for Redeeming

ECR Formula

Oracle Prices

NOTE: These examples do not account for the minting and redemption fees, which are set between 0.30% and 0.50%. Basically, the minting fee is 0.30% ; 0.50% is for redeeming.

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