⚙️Key Functions of f(x) 2.0

Opening and Closing xPOSITION - Minting fxUSD

  • Users can open xPOSITION by providing stETH or WBTC as collateral. fxUSD is minted as a byproduct of the xPOSITION opening using the f(x) Invariant formula.

  • The system dynamically adjusts leverage ratios and fxUSD minting to maintain overall stability.

Rebalancing Operations

  • Automatically adjusts leveraged positions to safe levels (see Risk parameters), significantly reducing liquidation risk.

  • This process is handled automatically by keepers.

Liquidation Mechanism

  • If rebalancing fails, the protocol initiates liquidation by redeeming associated fxUSD to always protect fxUSD's integrity.

  • This process is handled automatically by keepers.

Stability Pool

  • Offers yield opportunities for users while serving as a peg-keeper for fxUSD.

  • Maintains price stability through efficient arbitrage operations.

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