Swap Limit (PSM Limit)

In PSM, the amount of stablecoins that can be exchanged(swapped) with KCD is limited per stablecoin — also known as Swap Limit. A user wanting to pay USDT and receive KCD may do so within the Swap Limit of USDT, and vise versa. Swap Limit constantly changes based on supply and demand.

Terms

Each collateral type has Swap Limit, PSM Mint Amount, Temporary Mint Limit and Maximum Mint Limit

Term	Definition
Swap Limit (PSM Limit)	Maximum amount that can be exchanged from one token to another. Fluctuates based on Temporary Mint Limit, Deposit Amount and PSM Mint Amount.
PSM Mint (Amount)	Amount of KCD minted through PSM.
Deposit Amount	Amount of collateral deposited in PSM contract for each stablecoin. Always equal to PSM Mint Amount.
Temporary Mint Limit	Maximum amount of KCD that can be minted via PSM for each stablecoin. Updated every 10 minutes.
Maximum Mint Limit	Maximum possible limit for Temporary Mint Limit. Therefore, Temporary Mint Limit fluctuates only within Maximum Mint Limit.

‘PSM Mint’ refers to amount of KCD minted through PSM. PSM Mint is different from KCD minted through CDP Contract in that PMS Mint does not accrue Stability Fee.

‘Deposit Amount’ refers to amount of collateral deposited in PSM contract for each stablecoin. Currently two types of stablecoin (USDT, USDC) are supported.

‘Temporary Mint Limit’ refers to the maximum amount of KCD that can be minted via PSM for each stablecoin. It is updated every 5 minutes based on set logic (more in 'Update Logic' below).

‘Maximum Mint Limit’ is Swap Limit (PSM Limit) set by Kurrency Team. ‘Temporary Mint Limit’ is updated based on set logic but cannot exceed Maximum Mint Limit

Swap Limit (PSM Limit)

	PSM Limits
USDT to KCD	[USDT Temporary Mint Limit] - [USDT Deposit Amount] or 0 (if [Deposit Amount] > [Temporary Mint Limit])
USDC to KCD	[USDC Temporary Mint Limit] - [USDC Deposit Amount] or 0 (if [Deposit Amount] > [Temporary Mint Limit])
KCD to USDT	[USDT Deposit Amount] - 50% of [USDT Temporary Mint Limit] or 0 (if 50% of [Temporary Mint Limit] > [Deposit Amount])
KCD to USDC	[USDC Deposit Amount] - 50% of [USDC Temporary Mint Limit] or 0 (if 50% of [Temporary Mint Limit] > [Deposit Amount])

‘Swap Limit (PSM Limit)’ is the maximum amount that can be exchanged from one token to another in PSM. Since ‘Swap Limit’ fluctuates depending on ‘Temporary Mint Limit” and “Deposit Amount’ for each stablecoin, total of 4 Swap Limits exist within PSM.

Temporary Mint Limit - Update Logic

Update Logic	Temporary Mint Limit	Update
(Total sum of PSM mint for each collateral) >(Total sum of Temporary Mint Limit for each collateral) x 90%	Increase	1% of KCD minted through CDP contract
(Total sum of PSM mint for each collateral) < (Total sum of Temporary Mint Limit for each collateral) x 60%	Decrease	1% of KCD minted through CDP contract

The temporary mint limit for each collateral is determined by comparing the sum of the PSM KCD mint for each collateral to the sum of the temporary mint limit.

Temporary Mint Limit for each collateral is determined by comparing the sum of PSM Mint to the sum of Temporary Mint Limit of each collateral. For example, if the sum of PSM Mint exceeds 90% of Temporary Mint Limit, Temporary Mint Limit is increased by 1% of KCD minted through CDP Contract. Such design is to prevent KCD peg from becoming overly dependent on PSM — same as the reason for implementing PSM Fee.