Marketplace
In the Unlockd Marketplace you will be able to get awesome RWAs at a reduced price.
Available assets
A) RWAs
Any user can list a supported RWA in the Marketplace.
B) Assets in liquidation
As a part of the Liquidation Process, Unlockd allows third parties to participate in the health of the overall protocol by acting in their own interest (to receive the discounted asset) and as a result, ensure loans are sufficiently collateralized.
C) Assets with Debt
Users who have an active loan against collateral can put one or multiple assets from the bundled collateral for sale or auction.
In Unlockd, the process of selling or auctioning an asset that's used as collateral for an active loan, or being forcedly liquidated, has evolved significantly from V1 to V2. Here's an updated and accurate description of how it works:
Understanding Debt Proportionality
When you have an asset collateralized in an active loan, you have the option to put this asset up for sale or auction. However, the process and implications in V2 differ from the previous version:
Variable Debt Attachment: In V2, the debt linked to a specific asset up for sale or auction is not a fixed quantity. Instead, it's proportional to the asset's contribution to the overall loan value. This proportional debt can range from zero to its maximum value, depending on various factors.
Health Factor Influence: The variability in attached debt is significantly influenced by the Health Factor (HF) of the loan position minus the asset. Essentially, the remaining HF after removing the RWA from the loan equation determines the range of debt that may be attached to the asset for sale.
In certain situations, you might find it beneficial or necessary to adjust the debt linked to the asset. For example, if an asset's valuation underpins a substantial portion of the total loan debt, you might need to manage the associated debt to enable the sale. This could involve repaying a part of the loan equivalent to the asset's value in the loan structure.
Buyer's Responsibilities and Process
Debt Repayment by Buyer: When a buyer acquires the asset, they also inherit the responsibility to repay the portion of the debt associated with it. Upon claiming the asset, the buyer effectively repays the seller's remaining debt linked to that specific asset.
"Bid Now, Pay Later" Option: If the buyer utilized the 'Bid Now, Pay Later' feature, the asset will remain as collateral until the buyer fulfills the debt repayment.
Key Takeaways for Sellers and Buyers
For Sellers:
Be prepared to handle the variability of debt associated with your asset. Understanding how your asset's removal affects the overall loan's Health Factor is crucial for successful transactions.
Be aware that selling the asset may require repaying part of the loan commensurate with the asset's valuation.
For Buyers:
Acknowledge that purchasing a collateralized RWAs involves taking on the corresponding debt immediately. You do not inherit the debt, it needs to be repaid at the moment of the purchase if no BNPL option is used.
If opting for 'Bid Now, Pay Later,' know that the asset remains collateralized until the associated debt is cleared.
Auctions
Auctions start with a predetermined starting bid. Participants are invited to place bids higher than the current leading bid within the specified bidding period.
The participant with the highest bid at the end of the auction period is declared the winner and is obliged to purchase the asset at their final bid price.
Once the auction concludes, the settlement process begins, and the asset ownership is transferred to the winning bidder.
Seller-Designated Conditions: For RWAs and RWAs with debt, sellers have the liberty to set the auction conditions, such as the starting bid and the bidding period.
Liquidation Auctions: These auctions have a specific set of rules and processes, which can be reviewed in detail in our Liquidation Auctions section.
Incentivizing Early Bidders
To encourage early bidding, Unlockd offers a unique incentive. If the first bidder is outbid by others, they receive a 2.5% reward as an incentive for initiating the bidding process.
This incentive also applies if the original RWA owner decides to redeem (or repay) the asset. In these cases, the first bidder is compensated for their participation and the initial risk they took by bidding.
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