| Opening a trade | First, set up a position with a desired leveraged pair, and set slippage tolerance - Deposit a min of $10.1 worth of collateral
- Collateral deposit is taken and converted to required FLP index token
Pay Trading fee and Swap fee - If user deposits collateral outside what’s required (e.g. longing ETH with USDC as collateral), user pays a swap fee to swap their token to the required collateral (e.g. protocol automatically swap USDC to ETH to complete the open position process)
- Relevant fees are added to required collateral, deducted and transferred to fee pool, ultimately goes to FLP/FUL stakers and protocol treasury (as shown in profit sharing session)
- See "Fees" page for details
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| During a trade | Paying Borrowing Fee on an hourly basis - Paid by both longs and shorts to fee pool, updated on an hourly basis
- The borrowing fee is a function of the utilisation of the asset. The higher the token utilisation, the higher the borrowing fee.
- Borrowing fee:
(assets borrowed) / (total assets in pool) * 0.01% per hour
(Optional) You are able to manage your position size and leverage level by: - Depositing/Withdrawing collateral to/from existing position
- Creating a new position under the same long/short strategy on top of current position for the same indexed token. The newly created position will merged with the existing one and form a combined position with updated position size and leverage level
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| Closing a trade | Closing your position at your desired price - A user can choose what token to receive their profits / collateral in
- By default, a user receives profit in index token (if you long ETH, you get ETH) or stables (if you short / long other non index tokens)
- Relevant fees are taken from collateral and sent to fee pool
*Therefore, insufficient collateral may cause inability to repay fees, which could trigger liquidation! Paying Trading fee and Swap fee - If user deposits collateral outside what’s required (e.g. ETH long requires ETH collateral), user pays a swap fee to swap their token to the required collateral ETH
- Relevant fees are added to required collateral, deducted and transferred to fee pool
- See "Fees" page for details
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| Liquidation | If the user's position falls below liquidation price or collateral left is insufficient to cover fees, the position will be liquidated and closed. - Full Liquidation - there is no remaining user collateral
- original collateral < loss
- (original collateral - loss) < (borrow fee + margin fee)
- (original collateral - loss) < (borrow fee + margin fee + fixed liquidation fee)
- Partial liquidation - there is remaining user collateral
- (original collateral - loss) * 100 < position size
*User’s collateral will be utilised to pay off losses to the FLP and taken as liquidation fees which will be transferred to liquidation vaults |