Glossary of terms.
2 Hour TWAP Price: Is the Time Weighted Average Price from the last 2 hours on the highest liquidity Automated Market Maker pool. In the case of uGas it will be the Uniswap uGas/ETH pool. For uSTONKS, it will be the uSTONKS/USDC pool. The 2hr TWAP is used to: a) Calculate the number of synths that can be minted b) Calculation basis for liquidations
Collateral Ratio (CR): It is the ratio of your collateral to the 2 hour TWAP value of minted tokens. ie. If you deposit as collateral 20 ETH, mint 100 uGas tokens and the TWAP price is 0.05 ETH per token you get a Collateral Ratio of 4:
20ETH/(100uGas0.05ETH)=20/5=420 ETH / (100 uGas * 0.05ETH) = 20 / 5 = 4
Collateral Ratio (Global): This is the average collateralization ratio across all token sponsors of a single synths contract, excluding those that have been liquidated. It is calculated by dividing the total collateral deposited by all token sponsors in the contract by the total number of outstanding synthetic tokens. The GCR is used to set collateralization requirements for new synthetic token issuance and to enable “fast” withdrawals.
Collateral Ratio (Post-Tx): This is your CR after you submit the transaction.
Expiry Price: Synths token expiry price is determined by median gas price of all Ethereum transactions for the past 30 days.
Liquidation Price: Calculated by using the minimum collateral ratio and 2 hour TWAP price of the synths. Liquidation price is the synth price that if exceeded, leads to a liquidation. ie. Liquidation price: 0.13, if 2hr TWAP goes above 0.13, then there is a chance you will get liquidated.
LP: Liquidity Provider is when deposit a pair of collateral to an AMM (Automated Market Maker ie. Uniswap) pool. Providing uGas and ETH on Uniswap makes you an LP.
Minimum Collateral Ratio: The CR that once your position is lower than, it can be liquidated. The minimum CR for uGas is 1.25.
Redeem: If you minted the synthetic token, you can redeem it at any time to obtain the underlying collateral (before and after expiry). If you redeem before expiry, you have to redeem the exact number of synths that you minted. Alternatively, you can redeem any number of synths except a minimum balance of 5 uGAS or 1 uSTONKS which you can redeem after expiry.
Settle: If you bought the synth on Uniswap and hold the token past expiry date, you will be able to settle it and obtain the underlying collateral. Settling is only possible after expiry. Before the expiry date, you can just sell the synth on Uniswap.
Short: If you think the synth token price is too high, you can short the token. To do this, you would mint and sell the synthetic token on Uniswap.
Synth: Short for Synthetic Token and used as abbreviation throughout the docs.
Last modified 10mo ago
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