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How to Participate
To participate in Scientix Finance, you need to deposit BUSD into the vault. After that, you can borrow scUSD up to 50% of the deposited amount. Your debt will have a minimum 200% collateralization ratio.
The vault deposits BUSD into ALPACA to get the lending interests and ibBUSD stake rewards. The yield pays down the global debt in the system, reducing all depositors' debt. If you didn't borrow scUSD, the yield will increase your scUSD borrow limit. Users can withdraw in the amount up to reaching the 200% collateralization ratio. So as the protocol pays down your debt, you can withdraw more BUSD.
At any time, you can repay a portion or all of your debt in order to unlock your collateral. BUSD and scUSD are treated 1:1 for repayment and liquidation. As such, you can repay your scUSD debt with BUSD and/or scUSD. Repaying debt with scUSD is also a pegging mechanism because if scUSD were to be under the peg, users could buy it from AMMs and pay off their debt at a discount.
At any time, you can liquidate a portion or all of your collateral. The contract will repay your scUSD debt using the BUSD from your collateral.
Once the global debt was reduced by the yield, the proceeds will be transferred to the Transmuter Contract. The Transmuter is the chief pegging mechanism for the Scientix protocol. Participants will be guaranteed to have a 1:1 redemption of scUSD for BUSD.
Users deposit scUSD into the Transmuter. As the yield comes in, it will credit BUSD in proportion to users with the amount they have staked. Once a user chooses to withdraw the converted BUSD, the same amount of scUSD will be burned.
In this process, there is an interesting side effect: a user's position has the chance to be overfilled. Let's take an example, a user deposits 1000 scUSD, and after some time, that staking position will have 1050 BUSD filled. Once a user has gone past this limit, other users may have the chance to initialize a claim on their behalf. For any balance of BUSD exceed their staked scUSD, the user who claimed on their behalf will have that surplus in amount immediately convert their staked scUSD. In this given case, the user who claimed it will have 50 of their scUSD immediately converted into BUSD. If the person who staked the scUSD claims their BUSD with a surplus, the surplus will be cycled back into the Transmuter and be spread globally.
At launch, there will be four pools:
- One for ibALPACA
- One for SCIX
- One for scUSD/BUSD PancakeSwap LP token
- One for SCIX/BUSD PancakeSwap LP token