Borrow Guide

A guideline for loans.

Things to Check Before Loans

• Make the asset is available.

  • The assets currently available at Archi Bank are Archi Dollar (ARCD) and Ether (ETH).

  • CAT is included in the list of assets but it is paused. It will resumed when Archi Swap's ETH/CAT liquidity pool becomes large enough to support CAT price fluctuations.

• Check to see if the deposited assets are collateralized.

  • Select the collateral asset if there are multiple assets deposited. Cancel if you do not want to use it when liquidating.

• Check the utilization of the borrowing limit.

  • 60% is suitable if you are not a fan of liquidation risk.

Things to Check During Loans

• Input the amount you want to borrow and check the following.

  • Check the changed utilization of the borrowing limit.

    • 60% is suitable if you are not a fan of liquidation risk.

  • Check the utilization rate and the expected interest rate.

    • The expected interest rate varies depending on the utilization rate. The interest rates rises sharply when the utilization exceeds 80%. Make sure your post-loan utilization doesn't exceed 70% if you are not willing to pay an excessively high-interest rate on someone else's loan after getting a loan.

Precautions After Loans

• Be careful of sudden price drops of collateral coins or rapid price increases of borrowed coins.

  • If the utilization of the borrowing limit is high, there are risks of liquidation due to price fluctuations.

  • Archi Bank temporarily pauses loans and liquidation if CAT prices fluctuate by 30% compared to the previous day. It is resumed after seeing market conditions. This cannot exceed a maximum of one day.

• Check the liquidation rate.

  • If the liquidation rate is 100% and if insolvency occurs (the value of the loan is greater than the collateral)—the liquidator can liquidate the entire loan as long as there is enough collateral to be foreclosed.

    • For example—when the collateral value is 1000 KRW, and the loan value becomes 1001 KRW—not 1 KRW but 1001 KRW is liquidated if the collateral is sufficient.

  • Pay attention to liquidation as the current Archi Bank liquidation rate is set at 100% When liquidation occurs—the liquidator will foreclose and take the collateral at 90% of the asset price at the time of liquidation.

• The utilization of the borrowing limit must be managed so that the loan is not subject to liquidation.