Mortgage Loan
Introduction
Demand Scenario
Lending business has a large business demand in the world of digital assets. One of the main businesses is bitcoin/stable currency pledged lending. According to our market research and contacts, we found that there are about two groups of bitcoin pledged to lend:
The first is for users to use capital turnover: Users hold mainstream assets/platform currency assets, the price is relatively stable and long-term bullish [firm holding], when there is a temporary need for turnover, the assets will be pledged to lend USDT to complete the funds. Repayment will be made after the turnover demand; some users will pledge assets for short-term operations when individual currencies rise in stages (participating in IEO) or short-term participation and return the assets after selling the assets;
The second is that customers borrow Bitcoin/USDT to short, which is margin short, usually speculators speculate or hedge the risk of their futures positions to reduce leverage
Functional Overview
The system can be configured with a variety of loan currency pairs. The user needs to confirm the loan interest rate before pledging. After pledging its own assets, the system will transfer the assets that the user wants to borrow to the user’s available spot account according to the configured initial pledge rate, and the assets obtained from the loan can be carried out. Transactions, Withdrawals, Fiat(P2P), and, other operations;
There is no time limit for borrowing. After the user returns the principal and interest, the system will return the pledged digital assets, and the interest will be calculated on a daily basis; the system will monitor the value of the pledged assets according to the currency prices of multiple third-party mainstream exchanges. If it is lower than the risk value , the system will automatically execute the liquidation operation. Before that, the user will receive a system risk reminder and can repay or supplement the pledged assets in advance.
Product Profit Model
The exchange mainly earns the lending interest of the mortgage loan. The daily interest can be configured and calculated according to the common market interest rate of 0.05% (annualized 18.25%). If the annual turnover is 1 million, the interest income will be 182,500 U.
Formula & Concept & SMS Description:
Pledge Rate & Risk Parameters
The higher the risk value, represents higher risk.The value at risk of closing a position represents when this value is reached, Trigger the closing operation;
Both the mortgage rate and the risk value are a number between 1 and 100. For example, the mortgage rate is 80%, and the background needs to be set to 80;
The price is taken from the ChainUP exchange rate service, which is the index price obtained by the weighted average of the prices of external platforms (such as Huobi, Binance, OK, etc.). If the merchant's own platform currency wants to be used as the pledge currency, it is necessary to contact the project manager for separate processing.
The following is an example of mortgage BTC to borrow USDT, as shown in the figure below.
Interest calculation
Interest is calculated once a day at 0:00 and is included in the amount to be repaid. Interest is calculated based on the remaining unpaid principal. The daily interest rate is calculated based on the interest rate at the time of Loan:
Daily new interest = Total amount to be repaid * daily interest rate (Total amount to be repaid = principal to be repaid + interest to be repaid)
When the user borrows, the interest of the day will be charged once. If the user lends at 23:59, an interest will be charged immediately, and another amount will be charged after 0:00.
The calculation precision is based on the lent coin precision + 4 (if the lent coin precision is 4 digits, the interest is 8 digits).
Account Circulation Instructions
Supplementary margin logic:
When the price of the user's mortgage assets falls, the risk value rises. At this time, the user can repay in advance, or can continue to borrow by supplementing the collateral to reduce the risk value.
It is not necessary to supplement the collateral, but when the risk value reaches the set closing risk value, the system will automatically close the position.
The user can replenish any amount of collateral, and the system will calculate the recommended replenishment amount (calculated according to the return of the minimum risk value after replenishment), and the formula is as follows:
Suggested replenishment amount = total amount to be repaid - total amount to be repaid based on pledge rate = total amount to be repaid - (collateral amount * latest price of collateral (USDT) * pledge rate / latest price of lent currency)
Note: The recommended value cannot be negative. If the current risk value is less than the pledge rate, the recommended top-up should be 0
Handling liquidation
When the price of the loan currency pair reaches the configured liquidation pledge rate, the system will use the market price to place an order for the pledged asset, exchange the pledged currency for the loan currency, and the system will automatically repay the outstanding principal and interest. The specific logic is as follows：
1.Set a robot UID for closing asset shipments(Configured at the Basic Config)Background configuration single sell order limit: 50,000 U (to avoid slippage loss caused by an excessive amount of money)
2. When there is a liquidation, the assets settled by the user's liquidation will be transferred to the robot
3. The robot monitors the balance at a certain frequency. When it finds that there are other currency balances, it will divide each currency into multiple sales according to the single selling limit, and sell it every 20s (leave some time for the placing robot to make up the order).
SMS & Email Alerts
There is a one-to-one correspondence between the notification text and the risk level, and the notification content cannot be modified. You can configure the risk value and notification interval.
1
[Exchange Signature] The current risk value of your loan order (loan 7019.25 USDT) is 63, please pay attention to risk control.
60
Low risk (60~70)
8
No reminder if lower than 60
When the risk level increases (over 60), you will be notified immediately, and if you stay at this level, you will be notified every 8 hours.
When it drops to this level (below 70), no notification will be triggered, and the notification will be executed every 8 hours.
2
[Exchange signature] The current risk value of your loan order (loan 7019.25 USDT) is 70, higher liquidation risk, please pay attention to risk control.
70
Medium risk (70~80)
2
When the risk level increases (over 70), you will be notified immediately, and if you stay at this level, you will be notified every 2 hours.
When the level drops to this level (below 80), no notification will be triggered, and the notification will be executed every 2 hours.
3
[Exchange Signature] The current risk value of your loan order (loan 7019.25 USDT) is 85, liquidation risk is very high. Please replenish the collateral as soon as possible.
80
High-risk (80~90)
0.5
When the risk level increases (over 80), notify immediately, stay at this level and notify every 0.5 hours.
4
[Exchange Signature] Your loan order (loan 7019.25 USDT) has a risk value exceeding the limit (90) and has triggered liquidation.
90
liquidation
--
Notify as soon as VaR reaches 90
Note: The notification method supports email and SMS, and SMS notification will be given priority. If the mobile phone number is not bound, an email notification will be sent.
Background Config
Basic Config
Access the URL of your background management system in the browser, the menu path: [Value Added Services] - [Loan] - [Basic Loan Configuration], as shown in the figure below.
Function Description:
Loan master switch: The main switch that controls the loan function. If it is not enabled, the front-end page will prompt you when this function is used. When closing the loan master switch, it will check whether there are outstanding assets, and if there is ( there are still unfinished user loans), it cannot be closed;
Loan switch: After closing, users cannot make new mortgage loans, and other functions (such as repayment of principal and interest, etc.) can be used normally;
Robot UID: Only the account is taken over when the user's mortgage assets are liquidated. For details, please refer to Handling liquidation
Rules Links: The user clicks on the loan homepage【Description of Loan Rules】, the corresponding link.
Loan Crypto Config
Menu path: [Value-added Services] - [Loan] - [Loan Currency Configuration], as shown in the figure below.
The loan currency is the currency lent to the user by the exchange, usually a stable currency with less fluctuation in value. Currently, only USDT is supported.
Mortgage Crypto Config
Menu path: [Value-added Service]-[Loan]-[Mortgage Currency Configuration], as shown in the figure below.
Add/Edit Crypto
Click [Add Currency] or [Edit] button, you can configure the mortgage currency, mortgage rate, liquidation risk value, and supported mortgage currency pairs here, as shown in the figure below.
Risk Config
Configure risk levels and notification alerts
Menu path: [Value-Added Services]-[Loan]-[Risk Level Configuration of Mortgage Currency], as shown in the figure below.
Click [Add Currency] or [Edit] button, you can configure the risk level of the collateral currency and the corresponding notification frequency here, as shown in the figure below.
Data query
Loan Details
You can view the details of each loan for each user and the current status of loan orders.
Menu path: [Value Added Service] - [Loan] - [Loan Details], as shown in the figure below.
Loan Statistics
You can view the lending and repayment status of each currency every day, and count the fee income, interest income, and the number of users participating in the loan. Menu path: [Value Added Services] - [Loan] - [Loan Business Statistics], as shown in the figure below.
Client Display Config
Web Display Config
Add [Loan] on the web page,module entry, as shown in the figure below.
Background path: public management - website configuration - PC theme configuration - home page template - home page navigation configuration, as shown in the figure below.
Click the [Modify] button to add loan module related information on the details page, as shown in the figure below:
Title Type: Spot
Access path: /toLoan
App Display Config
Add [Loan] on the homepage of the app version, module entry, as shown in the figure below.
Backend path: System configuration - APP management - APP function service - add advertisement, as shown in the figure below.
Click the [Add Ad] button, and edit the [Loan] module information on the details page, as shown in the figure below:
Image title: Loan (display name on the APP homepage)
Access path:https://m.xxxx.com/zh_CN/app_operation/lend/?noHeader=1
(Replace your exchange domain name with the red part in the link above, and modify the link corresponding to the blue part for different languages: Chinese→zh_CN, English→en_US, Japanese→ja_JP, Korean→ko_KR)
Language: Set the language environment in which the APP displays the icon
Type: Android, ios, and H5 need to be set separately;
The picture below shows that in the Android app This icon is displayed in Chinese, and the display name is "Loan"
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