Citizen Reserve
  • Citizen Reserve
  • How It Works
  • Mechanisms
    • Citizen Banks
    • Borrowing ZUSD Stablecoin
    • Withdrawals
    • Reserve Fund (OLD)
    • Reserve Fund Liquidity Provider Queue and Citizen Bonds.
    • Liquidations
      • Liquidation 1.0) Reserve Fund
      • Liquidation 2.0) Collateral Auction
      • Liquidation 3.0) Slash Auction
    • Redemptions
    • Citizen DAO Governance
    • Citizen DAO Treasury
    • Oracle Module
    • Deployment of Alternative Stablecoin Frameworks
    • Liquidian Bridge
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  1. Mechanisms

Borrowing ZUSD Stablecoin

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Last updated 1 year ago

Users may mint and withdraw ZUSD as a loan against their BankValue. Citizen charges an upfront fee of .5% for opening a Bank and withdrawing a ZUSD loan. This fee is charged as a percentage of ZUSD withdrawn, and is added to the balance of the ZUSD loan outstanding. Citizen requires that users pay interest on ZUSD loans outstanding, and this interest obligation accrues to the balance of the ZUSD loan outstanding. This global interest rate is determined by the DAO. Fees and interest income accrue to the Citizen Treasury as revenue.

All banks have a Minimum Collateral Ratio (MCR) of 110%, allowing users to withdraw up to 90.91% of the $ value of their collateral. Should the collateral ratio drop below the MCR, that Bank contract will be liquidated. This can happen from a decrease in the price of the collateral assets, or from the accrual of unpaid interest.

The Liquidation Parameter is represented by (BankValue / (ZUSD Loan Outstanding)) < 1.1.

Should the liquidation parameter be met and return true, the Bank will be .

liquidated