Process to liquidation stkAAVE for mBTC Savers

This is the process to liquidate the accrued stkAAVE for the benefit of the liquidity providers of the mBTC Savers (imBTC). The stkAAVE is earned from the mBTC bAsset WBTC that is deposited into Aave.

High level liquidator contract process:

  1. Every 10 and a bit days
  • all stkAAVE for mBTC’s WBTC bAsset is claimed to the mBTC platform integration contract from Aave’s incentives controller.
  • The stkAAVE is transferred from the platform integration contract to the liquidator contract.
  • 10 day cooldown of the stkAAVE is initiated.
  1. After the 10 day cooldown
  • Redeem AAVE from the stkAAVE to the liquidator contract
  • Swap AAVE for WBTC using Uniswap V3
  • Mint mUSD from the USDC
  • Deposit the mUSD into the Savings Manager
  • Stream mUSD to Savings Contract (imUSD) over the next 7 days.

This is a snapshot of the amount of stkAAVE that has accrued until 30 June 2021 for the mBTC Savers.
Screen Shot 2021-06-30 at 3.47.05 pm

Notes

  • Around 3 stkAAVE is being accrued each week from the WBTC deposits.
  • At 0.0066 AAVE/BTC, 3 stkAAVE is worth around 0.02 WBTC which provides a 0.6% APY boost to mBTC Savers
  • Liquidating all the previously accrued stkAAVE will boost the mBTC saving rate by 4.3% APY for the week.

The following is a more detailed sequence diagram of the contract interactions in the liquidation process.

4 Likes