Liquidations

When a vault's ratio drops below 150%, anyone can repay part or all of its debt and take HYPE5 worth that debt plus a bonus.

What the liquidator gets#

HYPE5 seized = rUSD repaid × (1 + 0.1) / HYPE5 price

Repaying 1,000 rUSD with HYPE5 at $90 gives the liquidator 12.22 HYPE5, worth $1100.

What the vault owner keeps#

Debt that was repaid is gone, and any collateral not seized stays in the vault. Liquidation can be partial, so a vault is only cut back as far as the liquidator chooses.

Bad debt#

If a vault's collateral cannot cover its debt plus the bonus, the liquidator takes all of it for the debt it covers at that price, and the remainder is recorded as bad debt.

Running a liquidator#

Call liquidate(owner, maxRepay, priceUpdate) on the CDP contract with a price signed by the Resarv API. Liquidations stay open even when deposits and minting are paused.

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