Is there a standard (hard) liquidation in CurveUSD?
Last updated
Last updated
The short answer is, yes.
There is a "hard" liquidation in CurveUSD protocol that is set to a point when the Health of the position goes to 0%. Despite the fact that after getting soft liquidated the position would have $crvUSD as both collateral and debt asset (crvUSD/crvUSD), hard liquidation can happen after or even during the soft liquidation process.
There are two main reasons for hitting the hard liquidation point:
1. Borrowing fees - increasing the debt over time LINK.
2. Losses during the soft liquidation process due to price swings LINK.