USH Implementation

Although the process of interacting with USH in the Hatom Lending Protocol shares similarities with other assets, there are notable distinctions in how USH is implemented and how users interact with it within the USH pool. These differences are specifically designed to ensure the price stability of USH.

Unlike the other assets within the Lending Protocol, USH operates differently. It is minted and burned by the smart contract each time a user borrows and repays it. While USH can be provided in the Lending Protocol and utilized as collateral, it's essential to understand that the supply APY for USH remains fixed at 0%. However, if extra rewards are introduced to the USH Money Market, those who utilize it as collateral could earn these additional rewards.

USH Minting Rates

The USH minting interest rates and discount rates are determined through Governance. Periodically, Hatom Governance has the authority to adjust the interest rates in order to ensure stability following the supply and demand dynamics.

Lending Protocol

In the Hatom Lending Protocol, users must supply assets into their respective money markets for others to borrow them. This ensures that if a user wants to borrow USDC using collateral, liquidity in USDC must have been provided by another user within the protocol.

However, this mechanism does not extend to USH. Specifically, users wishing to borrow USH can do so without a previous user supply of USH in the market. The protocol uniquely mints USH on-demand for borrowers, and upon repayment, the USH is burned, eliminating the need for supply-side liquidity for this asset.

Users can use certain assets offered on the Lending Protocol as collateral for minting USH. The quantity of USH they can mint is determined by the value of their collateral and its corresponding collateral factor.

Through the Lending Protocol, all assets allowed to mint USH will be assigned a fixed discount rate. However, these rates will not be uniform across all assets; some will have a low discount rate, while others will have a higher one. Despite the varying amounts of USH minted through this facilitator, these rates will remain constant. Consequently, users can precisely calculate their annual loan payments, as the utilization rate will not affect these calculations.

Isolated Pools

The Isolated Pools will offer a convenient way for the users to mint USH without any minting fee. This approach simplifies the minting process, making it more accessible and cost-effective for users interested in leveraging their EGLD or sEGLD assets.

It will feature some novel implementations, where both EGLD and sEGLD provided by the users are used in the Liquid Staking and Lending Protocol to generate yield which is then injected into the Staking Module ensuring constant growth of sUSH relative to USH.

Boosted Vaults

The Boosted Vaults will come with no minting fee for USH, but users will be charged a small fee for the rewards earned through this type of under-collateralized yield farming strategy.