Official AlphBanX Documentation
Last updated
Last updated
What is AlphBanX?
AlphBanX is a decentralized platform that allows you to borrow AlphBanX Dollars by using Alephium native Token (Alph) as collateral. To ensure safety and stability, the system aims to keep the collateral value at least 150% of the amount borrowed.
If your collateral value falls below 150%, your Alph tokens are auctioned off in stages to repay the loan. The auctions are divided into four pools, offering discounts of 5%, 10%, 15%, and 20%. Collateral is first offered in the 5% discount pool; if it isn't sold there, it moves to the next pool with a higher discount, continuing until it's purchased.
Earning Fees: Borrowing fees collected by AlphBanX are dynamically distributed between auction pool Liquidity providers and ABX stakers. For example:
-> If 10% of ABDs are staked in auction pools, 90% of fees go to ABD bidders and 10% to ABX stakers, incentivizing ABD demand.
-> If 80% of ABDs are staked, 80% of fees go to ABX stakers and 20% to ABD bidders, reducing ABD demand incentives.
This approach prioritizes growth by incentivizing ABD bidding early on and shifting profits to ABX stakers as the system matures.
Buying at a Discount: You have the opportunity to purchase Alph tokens at discounted prices during liquidations. This allows you to take a risk-free short position on overleveraged loans. You can either dollar-cost average (DCA) into Alph or arbitrage the discount by selling the tokens back to ABD, securing an immediate 5-20% profit through a risk-free trade. Meanwhile, if no liquidations occur, you still earn yield on your stablecoin.
This setup allows ABD providers to profit whether the ALPH token price rises or falls. If the price rises, more borrowing occurs, increasing the fees they earn. If the price falls, more collateral is liquidated, giving them chances to buy Alph tokens below market value.
In essence, AlphBanX lets you borrow against your Alph tokens while maintaining system stability through auction pools, offering advantages for both borrowers and ABD providers regardless of market conditions.
