Lending System

Collateralization in IFICHI

IFICHI's protocol ensures secure lending through a strict over-collateralization policy. This means borrowers must deposit a value greater than the loan they wish to receive in iTokens. The collateralization requirements are as follows:

• Standard Assets: For well-established assets like ETH, a typical industry collateralization ratio of 150% is applied.

• Arbitrary Collateral: The requirement for less common assets is determined based on asset quality, reliability of oracle price feeds, and market conditions. This approach takes into account market volatilities to safeguard the protocol's stability.

In instances where collateral value drops below the required ratio, the borrower's account is at risk of liquidation. More details on this process can be found in the Security section of this document.