Redeeming

Redeeming is the name of the process where the user returns TIA token to the protocol in exchange for collateral. The protocol burns the redeemed TIA token and pays the user approximately $1.00 worth of value in USDC and VCTY token.

Redeeming TIA tokens at the current CCR (Current Collateral Ratio) will produce a varying ratio of collateral (such as USDC or BUSD) and VCTY.

Redeeming formula:

The output ratio of USDC or BUSD and VCTY or tokens will depend on the current CCR (Current Collateral Ratio).

The redemption fee is not included in these examples.

Example 1: Redeeming 100 TIA at 100% CCR( Current Collateral Ratio).

At 100% CCR zero VCTY or is paid for the redemption. 100% of the output will be USDC or BUSD token. If 1 USDC or BUSD is $1.00, the returned amount of USDC or BUSD will be 100 and 0 VCTY:

Example 2: Redeeming 100 TIA at 80% CCR(Current Collateral Ratio) when 1 USDC or BUSD is $0.95 and 1 VCTY is $3.00.

At 80% CCR, the amount received for redemption will consist of 80% USDC or BUSD token and 20% VCTY token. In this case redeeming 100 TIA will result in 84.21BUSD and 6.67 VCTY.