Unlockd's Marketplace enhances the RWA acquisition experience with its "Bid-Now-Pay-Later" feature, a unique blend of bidding and instant loan creation.
This feature simplifies the process of acquiring assets by instantly leveraging them as collateral for a new loan.
Instant Loan Creation: When you successfully bid on an asset using the Bid-Now-Pay-Later option, an immediate loan is created in Unlockd, with the purchased asset serving as collateral. This integration streamlines the process, allowing you to acquire RWAs without upfront capital.
New Loan Terms: The loan associated with your successful bid has its terms set based on the current market conditions and the specifics of the asset, according to our appraisal engine and Dynamic LTV. This means each successful bid results in a fresh loan agreement, tailored to the moment's dynamics.
If your bid is outbid by another user, a small portion of the deposited USDC is used to cover the interest accrued during the Bid-Now-Pay-Later period.
This interest charge is typically minimal, especially if the Utilization Rate is reasonable, ensuring that the impact on your funds is small even in a competitive bidding environment.
No Inherited Debt for Bidders: Importantly, when bidding on an asset that already has a loan against it, you do not inherit the existing debt. Instead, the payment for the successful bid, whether it's your own funds or provided by Unlockd, is used to close the current loan on the asset.
Starting a New Loan Cycle: Once the existing loan is closed, a new loan is opened for you, the successful bidder, creating a clear separation between the previous owner’s debt and your new loan.
Flexibility for Buyers: This feature provides flexibility, especially for those who may be waiting for liquidity or prefer staggered payment arrangements.
Dynamic Marketplace: For sellers, this feature attracts a wider range of bidders, potentially increasing the competitiveness and final sale prices of assets.
It’s essential for bidders using this feature to understand the commitment they are making. Successful bids lead to immediate loan obligations with new terms based on current market evaluations.
As with any loan on Unlockd, managing your borrowing responsibly is crucial. Ensure you understand the terms, including interest rates and repayment schedules, associated with the new loan generated by your successful bid.
This approach offers a powerful tool for buyers, providing a convenient way to acquire desired RWAs while ensuring clear and responsible financial arrangements.
For a comprehensive understanding of how to utilize Bid-Now-Pay-Later, including detailed insights into loan creation and management, please refer to our marketplace and loan documentation.
In the Unlockd Marketplace you will be able to get awesome RWAs at a reduced price.
Any user can list a supported RWA in the Marketplace.
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.
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:
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.
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.
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.
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 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.
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.