CDP Overview

WCD(WEMIX Crypto Dollar) is CDP crypto dollar designed to maintain its value of 1 WCD = 1 USD, backed with cryptocurrency as collateral.

CDP, or Collateralized Debt Position, is method of minting Token in which the number of Tokens to mint is determined within i) User’s collateral and ii) Maximum Mint(or Borrow) limit. In Kurrency — with priority of Stability — the value of collateral is always maintained to be higher than minted WCD, similar to MakerDAO on Ethereum network. This ensures that every minted WCD is guaranteed by greater asset.

In traditional finance, loan is based on credit rating and collateral value. In blockchain ecosystem — where individuals cannot be identified — the value of collateral determines the loan size. To account for possible price fluctuations of collateral, collateral value is set higher than the loan size, and users can repay the loan as needed.