Skip to main content

Lending Module

The Lending module enables collateralized borrowing and lending with algorithmic interest rates.

Overview​

┌─────────────────────────────────────────────────────────────┐
│                    Lending Pool (USDC)                       │
│                                                             │
│  Suppliers                         Borrowers                │
│  ┌──────────┐                     ┌──────────┐             │
│  │ Supply   │────Interest───────▶│ Borrow   │             │
│  │ USDC     │◀───Earnings────────│ USDC     │             │
│  └──────────┘                     └──────────┘             │
│                                        │                    │
│                                        ▼                    │
│                              Collateral Required            │
│                              (wBTC, wETH, etc.)            │
│                                                             │
│  Pool Stats:                                                │
│  Total Supplied: $10,000,000                               │
│  Total Borrowed: $6,000,000                                │
│  Utilization: 60%                                          │
│  Supply APY: 3.2%                                          │
│  Borrow APY: 5.4%                                          │
└─────────────────────────────────────────────────────────────┘

Supplying Assets​

Supply to Pool​

rp1d tx lending supply 1000000uusdc \
  --from my-wallet

Enable as Collateral​

rp1d tx lending enable-collateral uusdc \
  --from my-wallet

Withdraw Supply​

rp1d tx lending withdraw 500000uusdc \
  --from my-wallet

Borrowing Assets​

Borrow from Pool​

rp1d tx lending borrow 500000uusdc \
  --from my-wallet

Repay Loan​

rp1d tx lending repay 500000uusdc \
  --from my-wallet

TypeScript SDK​

import { LendingModule } from '@rp1/sdk';

const lending = new LendingModule(client);

// Supply assets
await lending.supply(wallet, '1000000', 'uusdc');

// Enable as collateral
await lending.enableCollateral(wallet, 'uusdc');

// Borrow
await lending.borrow(wallet, '500000', 'uusdc');

// Check position
const position = await lending.getPosition(wallet.address, 'uusdc');
console.log(`Supplied: ${position.suppliedAmount}`);
console.log(`Borrowed: ${position.borrowedAmount}`);

// Check health factor
const health = await lending.getHealthFactor(wallet.address);
console.log(`Health Factor: ${health}`);

Interest Rate Model​

Interest rates adjust based on pool utilization:

Utilization Rate = Total Borrowed / Total Supplied

If Utilization < Optimal (80%):
  Borrow Rate = Base Rate + (Utilization / Optimal) × Slope1

If Utilization >= Optimal:
  Borrow Rate = Base Rate + Slope1 + ((Utilization - Optimal) / (1 - Optimal)) × Slope2

Current Parameters​

AssetBase RateSlope1Slope2Optimal
USDC2%4%75%80%
wBTC1%3%100%65%
wETH1%3%100%65%

Rate Examples​

UtilizationUSDC Borrow APY
20%3.0%
50%4.5%
80%6.0%
90%43.5%

Collateral Factors​

AssetCollateral FactorLiquidation Threshold
USDC85%90%
wBTC75%80%
wETH80%85%
wSOL70%75%

Max Borrow Calculation​

Max Borrow = Σ (Collateral Amount × Price × Collateral Factor)

Health Factor​

Health Factor = (Collateral Value × Liquidation Threshold) / Total Borrow Value
  • > 1.0: Safe
  • < 1.0: Liquidatable

Liquidation​

When Health Factor < 1:

# Liquidate undercollateralized position
rp1d tx lending liquidate \
  --borrower rp1underwater... \
  --repay-denom uusdc \
  --collateral-denom uwbtc \
  --amount 100000uusdc \
  --from liquidator-wallet

Liquidation Incentive​

AssetLiquidation Bonus
USDC5%
wBTC8%
wETH7%

Liquidators repay debt and receive collateral at a discount.

Query Commands​

Pool Info​

rp1d query lending pool uusdc

User Position​

rp1d query lending position \
  --owner $(rp1d keys show my-wallet -a) \
  --denom uusdc

Health Factor​

rp1d query lending health-factor $(rp1d keys show my-wallet -a)

All Pools​

rp1d query lending pools

Message Types​

MsgSupply​

message MsgSupply {
  string supplier = 1;
  cosmos.base.v1beta1.Coin amount = 2;
}

MsgBorrow​

message MsgBorrow {
  string borrower = 1;
  cosmos.base.v1beta1.Coin amount = 2;
}

MsgLiquidate​

message MsgLiquidate {
  string liquidator = 1;
  string borrower = 2;
  string repay_denom = 3;
  string repay_amount = 4;
  string collateral_denom = 5;
}

Parameters​

ParameterDefaultDescription
close_factor50%Max debt repayable in liquidation
liquidation_fee5%Fee to liquidators
reserve_factor10%Protocol fee on interest

Events​

EventTypeSupply = "lending_supply"
EventTypeBorrow = "lending_borrow"
EventTypeRepay = "lending_repay"
EventTypeLiquidation = "lending_liquidation"

Risk Management​

  1. Monitor health factor: Keep above 1.5 for safety
  2. Diversify collateral: Don't rely on single asset
  3. Watch rates: High utilization means high borrow rates
  4. Set alerts: Monitor liquidation risk

Next Steps​