DeDeLend is a lending platform that enables traders to use a perpetual position from GMX as collateral. You can borrow up to 50% in USDC of your unrealized profits from perpetual positions on GMX.

How we tokenized GMX positions

We had to tokenize GMX positions and make them transferable to enable borrowing against GMX positions. We have developed a group of smart contracts that allow traders to tokenize positions as ERC-721 tokens:

1. ETH-LONG

2. ETH-SHORT

Only the holder of the ERC-721 token will be able to open/edit or close the position from your trading account and make a profit.

How to borrow USDC against GMX position

You can borrow USDC against your unrealized profits if you open a position through DeDeLend interface.

1. Open DeDeLend and open a position

2. Wait until the position is in profits

3. Borrow up to 50% of unrealized profits

Liquidation

DeDeLend uses profits as collateral, meaning that in the case of liquidation, you will only lose your profits on the position but not its collateral.

Let’s imagine: we opened an ETH-LONG position at $500 (size 20 ETH), and the price increased to $1,000. Our current profits are $10,000. We borrowed 5,000 USDC from DeDeLend with a liquidation price of $800.

Later, the ETH price fell from $1,000 to $800 (-20%). DeDeLend will take the ERC-721 token to close the position. At the price of $800, profits will be $6,000.

Profits from the position will be converted in USDC and distributed according to these rules:

• Positions Collateral: 100% of the position collateral will be returned to the borrower

  The borrower will not lose their position collateral because DeDeLend allows to borrow only against unrealized profits (not the position collateral). In some cases, the borrower may lose the initial collateral if position was closed with negative PnL

• Liquidation Penalty: position profits — debt — interest fee

• LP Share: (position profits — debt — interest fee) plus 90% from the Liquidation Penalty

• Liquidator Fee: 10% from the Liquidation Penalty

Example of distribution $16,000:

• Position Collateral: $10,000 will be sent to the borrower

• Liquidation Penalty: $6,000 (position profits) — $5,000 (debt) — $50 (interest fee) = $950

• LPs share: $5,000 (principal) + $50 (interest fee) + $855 (90% from the Liquidation Penalty) = $5,905

• Liquidator Share: $95 (10% from the Liquidation Penalty)

Earn interest on DeDeLend

You can earn interest by providing USDC into DeDeLend pool (10% APR). Each loan is over-collateralized (min. 120%). When the intrinsic value of the collateral will be lower than required, DeDeLend will liquidate this position immediately.

Links

• Twitter

• Web

• Discord

• GitHub

Any of the above shouldn’t be taken as investment advice or a call to action.

DeDeLend doesn’t take any responsibility for your current or future decisions.

Our project is in beta. Use it at your own risk.