FAQ

1.Using GoldFox or other lending platforms to deposit and borrow digital assets, is there any risk in the principal?

In most cases, if you only use GoldFox to make deposits, there is no risk of jeopardizing the principal to

obtain current deposit interest and mining income. But if you open the pledge and lend out digital assets,

there may be a risk of liquidation. A very important value is involved here, which is the pledge rate.

2.What is the pledge rate and what is the use of the pledge rate?

The pledge rate is a very critical value of the lending platform. The pledge rate has a very large correlation

with your risk factor. For example, suppose the pledge rate of Bitcoin is 60% on GoldFox, which means

that you have deposited on GoldFox. With the equivalent of 10,000 US dollars in Bitcoin, you can borrow

6,000 US dollars in virtual assets from GoldFox. At this time, GoldFox is equivalent to releasing 6,000 US

dollars of liquidity for you. You can take the 6,000 US dollars of digital assets to mine on other platforms,

or you can repeatedly deposit in GoldFox, but you may face liquidation at this time risk.

3.What is liquidation? How much will I lose after liquidation?

When you loan digital assets on GoldFox, there is a risk of being liquidated. The liquidation threshold is

the criterion for assessing whether a GoldFox account is liquidated. This is related to your borrowing limit

and used limit. When your used limit exceeds the liquidation threshold, the changed account will be

liquidated. The liquidation threshold of GoldFox is 100%. The liquidation loss is related to your liquidated

assets and the liquidation coefficient. The liquidation coefficient of GoldFox is 50%. When the assets are

liquidated, 8% of the liquidation rewards will be given to the liquidator.

For example, when you deposit 10,000 U.S. dollars in Bitcoin and lend out 6,000 U.S. dollars in equivalent

digital assets, when Bitcoin drops and the total value of the digital assets you lent remains unchanged,

then the 100% liquidation threshold will be reached. , At this time, the GoldFox agreement will

automatically liquidate. After the liquidation, your Bitcoin assets on GoldFox are,

10000-100000.5 (liquidation coefficient)-100000.5*0.08 (liquidation reward)=4600 USD

At the same time, the equivalent virtual currency support you need to repay will become 6000-10000*0.5=2000 USD

At this time, your liquidation threshold will drop to 2000/4600=45%,

Your total principal is 4600 (equivalent bitcoin) + 6000 US dollars (digital assets lent by the platform)-3000 US dollars (the platform digital assets should be returned) = 9600 US dollars, and the loss is 8% of the liquidation reward, 400 US dollars.

Simply put, you will have a loss of 8% of the liquidated assets.

4.Why I have deposited 10,000 US dollars in Bitcoin in GoldFox, but I can only lend 3600 US dollars equivalent digital assets?

Assuming that the pledge rate of Bitcoin is 60%, when you deposit 10,000 USD of Bitcoin in GoldFox, you

can lend up to a total value of 6,000 USD equivalent of digital assets. Since the liquidation threshold of

GoldFox is 100%, when As soon as the price of Bitcoin falls, or the total value of the digital assets you lent

out rises, it will be liquidated immediately. Therefore, GoldFox recommends on the front-end webpage that

you only lend out digital assets equivalent to 60% of the liquidation threshold.

Simply put, when you deposit 10,000 US dollars in Bitcoin in GoldFox, although you can lend 6,000 US

dollars equivalent digital assets, you will immediately face the risk of being liquidated, so the front end of

GoldFox will only allow you to lend at most 60%60%10000=3,600 USD digital assets.

5.How are deposit rates and borrowing rates calculated?

The calculation method of the borrowing rate is a relatively complicated calculation method. The core

depends on the deposit utilization rate. According to each different digital asset, there will be different

borrowing rate models. The deposit utilization rate will have an inflection point. Before the inflection point,

the borrowing interest rate will be It is a gentle online curve, and when the utilization rate reaches an

inflection point, it accelerates online.

The deposit interest rate comes from the borrowing interest rate paid by the borrower, which changes with

the utilization rate. When the utilization rate is higher, the deposit interest rate is higher.