Chili-Ninja

On liquidations Our first rule when designing liquidations was that we cannot consider liquidations as source of revenue, and everything had to follow from there. That meant minimising liquidation volume, liquidation loss and liquidation probability. As such, we aimed to strike the best balance of protecting borrower collateral while keeping the lenders safe from bad debt. The result is not only well calibrated LTV values and liquidation penalties, but a whole suite of features, all a consequence of the philosophy of caring for both the borrowers and lenders: 1/ Partial, soft liquidations, only liquidating tiny bits and if position is at risk. The vast majority of liquidations are soft and one-offs. Lots of people thank us daily for this. 2/ Dynamic liquidation bonus, growing only with position risk. Due to our liquidation architecture being so robust, the overwhelming majority of liquidations happen with absolute minimum losses. (these two features alone turn liquidations into simple partial unwinds - allowing borrowers to preserve collateral and exposure) 3/ Liquidation analysis suite for vanilla loans, and multiply loops, showing risk at various price levels and interest rate. To this date, the only protocol in DeFi doing this, the closest to TradFi greeks and scenario analysis. Super proud to bring TradFi power tools to my fellow degens, allowing them to prepare for and avoid bad events. 4/ An incredibly advanced and mature oracle system, allowing us to use exchange rate and NAV-based oracles, multi-feed oracles, composable oracles with caps, floors, natively built twaps, price bands. This, all, in the name of avoiding scam wicks, thin secondary liquidity and ultimately bad liquidations. 5/ The most advanced stress test system in DeFi, allowing us to run thousands of test liquidations on actual mainnet to see where potential issues might occur and measure how fast liquidations happen. This way we can actually calibrate the risk parameters to avoid overly conservative values that disadvantage either lenders or borrowers. A few things stand out: ✅ No bad debt ever ✅ Vast majority of liquidations are partial unwinds ✅ No liquidation on SOL loops ever ✅ Extremely few JLP loop liquidations due to great LTV calibration and exchange rate oracle Our philosophy is that liquidations are just bad UX and we want to keep borrowers protected and the protocol solvent. A few huge features related to liquidations soon to be released: [redacted], [redacted], [redacted], [redacted]. Super proud of the work so far. Stay tuned.