Advance/Borrow

Advance / Borrow

Users with a HEX Stake Instance (HSI) are able to Borrow HDRN tokens by using a HEX Stake as collateral for the Borrowed HDRN. Unlike Mint, which requires a user to have served days of a particular stake, Borrow will give a user all available HDRN from the total days of the stake minus any days already Minted, paid in one lump sum upfront.

Borrowing HDRN has a requirement to pay back in HDRN tokens, in 30 day payment windows, with a fixed premium that stays consistent and is pre determined at the time the the user chooses to Borrow. The total amount of principal and interest repaid by a user will be burned and no entity other than the user that Borrowed can derive direct benefit from Borrowing.

The total premium percentage will be calculated by using a quotation based off 0.5x of the HEX APY at the time the user Borrows. (HEX APY at 40% would result in a 20% quotation then used to calculate 20% / 365 * 30 = 1.64% fixed across all 30 day payment windows).

Once a user has repaid their Advance in full, they are free to Mint any served days that are Mintable at that point, however any days that have been Minted can never be Borrowed again.

*IMPORTANT: If a user goes 3 x payment windows (90 days) without making a repayment, their Advance will be eligible for another user to liquidate, which involves a user paying off the remaining balance and ultimately taking ownership of the HEX Stake that was used as collateral.