Token Depositors Guide

As a token depositor in Osito Protocol, you can use eligible tokens as collateral to borrow wBERA without selling your tokens, allowing you to maintain your token position while accessing liquidity.

At a Glance

  • Deposit eligible tokens as collateral
  • Borrow wBERA against your tokens
  • Borrowing capacity based on mathematical safety guarantees
  • Pay interest on borrowed wBERA

How Token Depositing Works

The Borrowing Process

1

Check Token Eligibility

Ensure your token is eligible by checking if it was deployed by a verified deployer (Panda Factory or Ramen) and has verifiably burned LP tokens.

2

Deposit Tokens as Collateral

Connect your wallet and deposit your tokens as collateral, creating a position in the protocol.

3

Borrow wBERA

Borrow wBERA against your collateral, up to the maximum borrowing capacity determined by the protocol's mathematical model.

4

Repay & Withdraw

Repay your borrowed wBERA (plus interest) at any time to withdraw your collateral.

Borrowing Limit Calculation

Your maximum borrowing capacity is calculated based on:

  1. Global Token Limit: The maximum wBERA that can be borrowed against the token
    max_borrow = pool_wBERA - (pool_wBERA * pool_tokens) / (pool_tokens + dumpable_tokens)
  2. Your Position's Share: Your proportion of the global limit
    position_max_borrow = (your_tokens / total_deposited_tokens) * global_max_borrow

Interest & Repayment

When you borrow wBERA, you'll pay interest based on:

  • wBERA Utilization Rate: How much of the protocol's wBERA is currently borrowed
  • Token-Specific Rate: Additional interest based on the usage of your specific token

Interest accrues continuously and is added to your debt. You can repay your loan partially or fully at any time.

Withdrawal Limitations

Token depositors can withdraw their tokens up to the point that:

position_debt = position_max_borrow

This means you can withdraw some of your collateral as long as your remaining collateral is sufficient to cover your outstanding debt.

If your position's debt exceeds its maximum borrowing capacity (due to market changes or additional borrowing), you'll need to repay some debt or add more collateral before withdrawing.

Liquidation Risk

Your position may become eligible for liquidation if:

borrowed_wBERA > position_max_borrow

This can happen if:

  • The token's pool conditions change
  • More of the same token is deposited into the protocol (diluting your share)
  • Staked tokens are withdrawn (increasing dumpable supply)

To avoid liquidation, regularly monitor your position's health and maintain a safety buffer by borrowing less than the maximum allowed.

Getting Started

  1. Visit the Osito dApp: Navigate to app.osito.finance
  2. Connect your wallet: Use MetaMask or another Web3 wallet
  3. Navigate to "Borrow": Click on the Borrow tab in the main navigation
  4. Select token: Choose the token you want to use as collateral
  5. Create position: Deposit your tokens to create a borrowing position
  6. Borrow wBERA: Specify how much wBERA you want to borrow against your collateral
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