Decentralized Auctions

This dApp section is part of the integrated application DeFi. Technically, it is a dedicated application built on top of QGOV base layer and deeply integrated into QGOV governance (c.f. DeFi expert panel, Constitution). Decentralized auctions are the vehicle to maintain the DeFi system's stability.

There are three different types of auctions:

  • Liquidation: for borrowing vault liquidation auctions
  • System Debt: If DeFi system significantly lacks of synthetic asset (e.g. QUSD), any user can bid in QUSD to receive a lot of QGOV tokens
  • System Surplus: If DeFi system significantly created a surplus in synthetic asset (e.g. QUSD), these tokens can be purchased by bidding QGOV tokens to receive a certain lot size of synthetic asset

Auctions don't happen automatically, they need to be triggered by any user within QGOV system. Auctions can only be triggered if certain thresholds or limits are reached. Whereas this (collateral price) limit for borrowing vaults is depending on the collateralized asset's price, both system dept and surplus auctions are framed by a set of parameters that define thresholds, lot sizes and others. Please check the QGOV DeFi Risk Expert Panel parameter list for a list of all relevant parameters.

Information Boxes

Auction Stats

Shows your available QGOV balance according to the connected wallet account as well as funds in QGOV vault and synthetic asset balance (QUSD). A click on "Manage" will redirect you to QGOV vault.

QUSD System Balance

Shows different balances of DeFi application, like collected surplus and open debt as well as actual balance in QUSD and the surplus auction lot size as per system parameter governed.EPDR.QUSD_surplusLot.

A click on "Perform Netting" will net out surplus with open debt without initiating an auction.

QGOV System Reserve

The QGOV System Reserve collects QGOV from multiple sources and can be used to maintain the overall systems stability. The reserve balance shows the overall available funds whereas "Immediately Available" shows the funds that can be used by DeFi application at this very moment, e.g. for auctioning QGOV to get QUSD. The Debt Auction lot defines the lot size of QGOV per auction.

Liquidation

When a borrowing vault is free for liquidation due to price fluctuation of collateralized assets, you can create a liquidation auction with button "Create Auction" in the top right corner of the screen. A page opens up and allows to enter

  • Address of vault owner
  • Vault ID
  • Your initial bid in QUSD

After successful transaction confirmation, the auction is started and will remain open until auction time has ended (governed.EPDR.liquidationAuctionP). It will be visible under "Liquidation" tab until it has ended and everyone interested will be able to put a bid on it. Ended auctions are displayed there as well.

System Debt

When the system dept overpasses the threshold (governed.EPDR.QUSD_debtThreshold) and netting is not possible, any QGOV token holder can initiate a system debt auction with button "Create Auction" in the top right corner of the screen. A page opens up and allows to enter the initial bid in QUSD for the defined auction lot in QGOV.

After successful transaction confirmation, the auction is started and will remain open until auction time has ended (governed.EPDR.debtAuctionP). It will be visible under "System Debt" tab until it has ended and everyone interested will be able to put a bid on it. Ended auctions are displayed there as well.

System Surplus

When the system surplus overpasses the threshold (governed.EPDR.QUSD_surplusThreshold) and netting is not possible, any QGOV token holder can initiate a system debt auction with button "Create Auction" in the top right corner of the screen. A page opens up and allows to enter the initial bid in QGOV for the defined auction lot in QUSD.

After successful transaction confirmation, the auction is started and will remain open until auction time has ended (governed.EPDR.surplusAuctionP). It will be visible under "System Surplus" tab until it has ended and everyone interested will be able to put a bid on it. Ended auctions are displayed there as well.