Risk Management

EVAA relies on strong risk management to keep funds safe and build trust.

This overview simplifies the core parts of its risk management strategy, including how collateral is managed, and how interest rates are set.

Collateral Management

In DeFi, collateral secures loans and ensures repayment. EVAA may accept various assets as collateral, such as TON, stTON, tsTON, USDt, and jUSDC. The platform uses oracle services to ensure collateral prices are up-to-date and accurate, reducing the risk of price manipulation.

Liquidation Thresholds

Liquidation acts as a safety net for lenders. It involves setting a specific ratio between the loan value and the collateral's value. If the collateral's value falls to this predefined ratio — typically 75% — the assets are sold off to prevent losses. This ratio might be adjusted based on the asset's stability; more volatile assets could have a lower threshold.

Interest Rate Models

Interest rates are crucial in DeFi, affecting both borrowers and lenders. EVAA possibly uses a dynamic model that adjusts rates based on how much money is being borrowed versus how much is available — rates increase with high demand and decrease when liquidity is ample.

Factors Affecting Rates

• Liquidity - more available funds can lower interest rates, while scarce funds can raise them.

• Platform Utilization - high usage of the platform's funds can lead to higher rates to balance demand with supply.

• Collateral Stability - riskier collateral types can carry higher interest rates to offset potential volatility.