LTV Boost
Get higher LTV by locking JPGD
Last updated
Get higher LTV by locking JPGD
Last updated
LTV boosts allows users to increase the LTV of individual positions by up to 10% above the Base LTV of the selected collection.
To enable the LTV boost, $JPGD tokens need to be locked on a per-position basis as illustrated in the example below. The amount of boost can be chosen by the user, ranging from 0.01% to 10% extra LTV. Once activated, the boost effects will remain active until the user requests the withdrawal of the associated $JPGD.
To estimate out how much JPGD you need to lock, follow these steps:
Calculate the difference between the boosted credit limit and the base credit limit.
Multiply this difference by the lock rate.
Then, divide by the price of JPGD in Ethereum (ETH).
This formula helps determine the amount of JPGD tokens needed to unlock a 10% boost in loan-to-value (LTV). The cost is 20% of the extra value provided by the increased credit limit, payable in JPGD tokens.
So, to summarize, the formula for the amount of JPGD to lock is:
AmountOfJPGDToLock = (boostedCreditLimit - baseCreditLimit) * lockRate / jpgdPriceInEth
100 ETH floor collection 35 ETH = max borrow with no JPEG Card 45 ETH = max borrow with staked JPEG Card 60 ETH = max borrow with staked JPEG Card and locked JPGD tokens Assumed JPGD token price = $0.0006 Assumed ETH price = $1,000
Increase in credit limit due to locked JPGD tokens = 15 ETH x 20% cost (in JPEG tokens) = 3ETH / $0.0006 = 5,000,000 JPGD tokens.
With a 3 ETH cost you essentially unlock an additional 15 ETH of credit.
Boost owners can request a withdrawal at any time. The processing period is of 7 days, after which the boost associated to the position will be disabled and the $JPGD will be available for withdrawal.
When a user locks JPGD tokens to get a boost, those tokens remain theirs. If they transfer the NFT, the boost stays active for whoever owns the NFT next. Only the boost owner can disable a boost.
In the case of liquidation, the locked JPGD gets burned.
All boosts created prior to the application of PIP-58 have been marked as having a withdrawal requested and unlock time will be the current unlock time set when creating the boost. Users can cancel the withdrawal request anytime.
