Collateral Management
Collateral Management explains how XCCY values, monitors, and utilises assets to secure positions, margin, and leverage across all products.
Core Concept
Collateral is the foundation of risk coverage, leverage, and capital efficiency.
XCCY accepts a wide range of assets, including stables, LSTs, yield-bearing tokens, and real-world assets.
Each asset type is valued according to its risk profile, liquidity, and correlation.
Valuation Principles
Cash Stables
Priced at 1 USD with a depeg guard for sudden deviations.
Price feeds come from reliable oracles like Chainlink or Pyth.
Yield-Bearing Stables
Value is derived from shares × underlying asset price.
Includes Lido, RocketPool, or vault tokens.
Liquid Staking Tokens (LSTs)
Priced as shares × exchange rate to base asset × base asset to USD price.
Lending Protocol Tokens (Aave, Morpho, Fluid, etc.)
Collateral value = token balance × index × underlying asset price.
Real-World Assets (RWA)
Priced using NAV per share in USD.
Pendle Tokens (PT/YT)
PT: oracle TWAP or discounted NAV.
YT: realizable cash leg only, ignoring expected yield.
Collateral Use
Collateral secures open positions, swaps, and fixed-yield deposits.
Open orders block collateral based on the worst-case execution of the side with the largest potential loss.
Margin mode (Isolated, Portfolio, X-Mode) determines how efficiently collateral is utilized.
Excess collateral may be routed into XLP senior tranches to generate additional yield without increasing liquidation risk.
Key Takeaways
Collateral is dynamically valued to reflect risk, liquidity, and market changes.
Open positions and orders consume collateral according to worst-case exposure.
Margin mode affects collateral efficiency and leverage.
Idle collateral can generate extra yield through XLP strategies.
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