FAQ
Common questions about XCCY Protocol.
General
What is XCCY?
XCCY is a decentralized protocol for Interest Rate Swaps in DeFi. It lets you convert unpredictable Variable Yield from protocols like Aave into guaranteed Fixed Yield — or vice versa.
How is XCCY different from just holding aUSDC?
When you hold aUSDC, you earn Variable Yield that changes constantly. With XCCY, you can lock in a Fixed Yield rate for a specific term. If rates drop, you still earn your locked rate.
Is XCCY custodial?
No. XCCY is fully non-custodial. Your funds are held in smart contracts on-chain. Only you can withdraw your margin, and positions are automatically settled by the protocol.
What chains is XCCY on?
Currently deployed on Polygon. More chains coming soon.
Trading
What's the difference between FY and VY positions?
FY Position (Lock Fixed Yield): You receive guaranteed Fixed Yield, give up Variable Yield. Profitable when VY < FY.
VY Position (Trade Variable Yield): You receive Variable Yield, give up Fixed Yield. Profitable when VY > FY.
How do I know which position to take?
Take FY position if you want certainty or expect rates to drop
Take VY position if you expect rates to rise above current FY
What's the minimum trade size?
There's no protocol-enforced minimum, but very small trades may not be economical due to gas costs.
Can I close my position before maturity?
Yes. Execute an opposite swap to close. For example, if you have an FY position (negative notional), execute a positive notional swap to close.
What happens if I don't settle at maturity?
Your funds remain in the protocol until you call settlePosition(). There's no penalty for delayed settlement — you can settle anytime after maturity.
Margin & Risk
How much margin do I need?
Typically 5-20% of notional, depending on:
Term length (longer = more margin)
Expected VY volatility
Your risk tolerance
Can I add more margin to an existing position?
Yes. Call updateAccountMargin() with a positive amount to deposit more collateral.
What happens if I get liquidated?
Your position is closed
A liquidator receives your remaining margin
You lose your margin but don't owe anything extra
How do I avoid liquidation?
Monitor your Health Factor (keep > 1.5)
Add margin when HF drops
Use conservative leverage
Close positions if VY moves strongly against you
What collateral can I use?
Currently USDC and other whitelisted tokens. Each token has a discount factor that determines how much it counts toward margin.
Liquidity Provision
How do LP returns work?
LPs earn trading fees when swaps happen within their tick range. You choose a Fixed Yield range (e.g., 5-8%) and earn fees on trades in that range.
What's impermanent loss for LPs?
If FY moves within your range, your position gains directional exposure. At settlement, this could result in gains or losses separate from fees earned.
How do I choose my tick range?
Narrow range: Higher fees, more IL risk, more management
Wide range: Lower fees, less IL risk, set and forget
Can I add liquidity to multiple ranges?
Yes. You can have multiple LP positions at different ranges in the same pool.
Settlement
When does settlement happen?
After a pool's maturity date (termEndTimestamp). Anyone can call settlePosition() once the pool matures.
How is settlement calculated?
Where VY is the average Variable Yield over the term, as tracked by the oracle.
What if I have a loss at settlement?
The loss is deducted from your margin. If the loss exceeds your margin in the underlying asset, other collateral may be used through settler exchange.
Do I need to do anything at settlement?
Yes, you need to call settlePosition() or someone needs to call it for you. Settlement is not automatic.
Technical
What oracle does XCCY use?
Price feeds: OracleHub (Chainlink, Pendle TWAP)
Yield rates: AprOracle with adapters for Aave, Compound, Lido, Pendle, ERC-4626
Are the contracts audited?
[Audit information to be added]
Is there a bug bounty?
[Bug bounty information to be added]
Can I integrate XCCY into my protocol?
Yes! Check our Developer Documentation for integration guides and examples.
Fees
What are the trading fees?
Typically 0.01% (1 basis point) per swap. Fees go to LPs providing liquidity.
Are there any other fees?
Gas fees for transactions (network dependent)
No protocol fees currently
How are fees distributed?
Fees go to LPs with active liquidity at the current tick. Distributed proportionally to liquidity share.
Troubleshooting
Why is my transaction failing?
Common reasons:
Insufficient margin: Add more collateral
Pool expired: The pool has reached maturity
Slippage too high: Adjust sqrtPriceLimitX96
Not approved: Approve tokens for CollateralEngine
Why can't I withdraw my margin?
Possible reasons:
Withdrawal would put you below margin requirement
You have active positions that need the collateral
Need to settle positions first
My position shows unexpected PnL. Why?
PnL is based on the difference between your locked FY and actual VY. If VY moved significantly from when you opened, your unrealized PnL will reflect that.
Getting Help
Where can I get support?
Discord: [Link to be added]
Twitter: [Link to be added]
GitHub Issues: [Link to be added]
Is there a testnet?
[Testnet information to be added]
Where can I learn more?
Start with What is XCCY?
Read Core Concepts
Try the Getting Started guide
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