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liquidation.go
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liquidation.go
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package keeper
import (
"sort"
errorsmod "cosmossdk.io/errors"
sdkmath "cosmossdk.io/math"
sdk "github.com/cosmos/cosmos-sdk/types"
"github.com/incubus-network/fury/x/hard/types"
)
// LiqData holds liquidation-related data
type LiqData struct {
price sdk.Dec
ltv sdk.Dec
conversionFactor sdkmath.Int
}
// AttemptKeeperLiquidation enables a keeper to liquidate an individual borrower's position
func (k Keeper) AttemptKeeperLiquidation(ctx sdk.Context, keeper sdk.AccAddress, borrower sdk.AccAddress) error {
deposit, found := k.GetDeposit(ctx, borrower)
if !found {
return types.ErrDepositNotFound
}
borrow, found := k.GetBorrow(ctx, borrower)
if !found {
return types.ErrBorrowNotFound
}
// Call incentive hooks
k.BeforeDepositModified(ctx, deposit)
k.BeforeBorrowModified(ctx, borrow)
k.SyncBorrowInterest(ctx, borrower)
k.SyncSupplyInterest(ctx, borrower)
deposit, found = k.GetDeposit(ctx, borrower)
if !found {
return types.ErrDepositNotFound
}
borrow, found = k.GetBorrow(ctx, borrower)
if !found {
return types.ErrBorrowNotFound
}
isWithinRange, err := k.IsWithinValidLtvRange(ctx, deposit, borrow)
if err != nil {
return err
}
if isWithinRange {
return errorsmod.Wrapf(types.ErrBorrowNotLiquidatable, "position is within valid LTV range")
}
// Sending coins to auction module with keeper address getting % of the profits
borrowDenoms := getDenoms(borrow.Amount)
depositDenoms := getDenoms(deposit.Amount)
err = k.SeizeDeposits(ctx, keeper, deposit, borrow, depositDenoms, borrowDenoms)
if err != nil {
return err
}
deposit.Amount = sdk.NewCoins()
k.DeleteDeposit(ctx, deposit)
k.AfterDepositModified(ctx, deposit)
borrow.Amount = sdk.NewCoins()
k.DeleteBorrow(ctx, borrow)
k.AfterBorrowModified(ctx, borrow)
return nil
}
// SeizeDeposits seizes a list of deposits and sends them to auction
func (k Keeper) SeizeDeposits(ctx sdk.Context, keeper sdk.AccAddress, deposit types.Deposit,
borrow types.Borrow, dDenoms, bDenoms []string,
) error {
liqMap, err := k.LoadLiquidationData(ctx, deposit, borrow)
if err != nil {
return err
}
// Seize % of every deposit and send to the keeper
keeperRewardCoins := sdk.Coins{}
for _, depCoin := range deposit.Amount {
mm, _ := k.GetMoneyMarket(ctx, depCoin.Denom)
keeperReward := mm.KeeperRewardPercentage.MulInt(depCoin.Amount).TruncateInt()
if keeperReward.GT(sdk.ZeroInt()) {
// Send keeper their reward
keeperCoin := sdk.NewCoin(depCoin.Denom, keeperReward)
keeperRewardCoins = append(keeperRewardCoins, keeperCoin)
}
}
if !keeperRewardCoins.Empty() {
if err := k.DecrementSuppliedCoins(ctx, keeperRewardCoins); err != nil {
return err
}
if err := k.bankKeeper.SendCoinsFromModuleToAccount(ctx, types.ModuleAccountName, keeper, keeperRewardCoins); err != nil {
return err
}
}
// All deposit amounts not given to keeper as rewards are eligible to be auctioned off
aucDeposits := deposit.Amount.Sub(keeperRewardCoins...)
// Build valuation map to hold deposit coin USD valuations
depositCoinValues := types.NewValuationMap()
for _, deposit := range aucDeposits {
dData := liqMap[deposit.Denom]
dCoinUsdValue := sdk.NewDecFromInt(deposit.Amount).Quo(sdk.NewDecFromInt(dData.conversionFactor)).Mul(dData.price)
depositCoinValues.Increment(deposit.Denom, dCoinUsdValue)
}
// Build valuation map to hold borrow coin USD valuations
borrowCoinValues := types.NewValuationMap()
for _, bCoin := range borrow.Amount {
bData := liqMap[bCoin.Denom]
bCoinUsdValue := sdk.NewDecFromInt(bCoin.Amount).Quo(sdk.NewDecFromInt(bData.conversionFactor)).Mul(bData.price)
borrowCoinValues.Increment(bCoin.Denom, bCoinUsdValue)
}
// Loan-to-Value ratio after sending keeper their reward
depositUsdValue := depositCoinValues.Sum()
if depositUsdValue.IsZero() {
// Deposit value can be zero if params.KeeperRewardPercent is 1.0, or all deposit asset prices are zero.
// In this case the full deposit will be sent to the keeper and no auctions started.
return nil
}
ltv := borrowCoinValues.Sum().Quo(depositUsdValue)
liquidatedCoins, err := k.StartAuctions(ctx, deposit.Depositor, borrow.Amount, aucDeposits, depositCoinValues, borrowCoinValues, ltv, liqMap)
// If some coins were liquidated and sent to auction prior to error, still need to emit liquidation event
if !liquidatedCoins.Empty() {
ctx.EventManager().EmitEvent(
sdk.NewEvent(
types.EventTypeHardLiquidation,
sdk.NewAttribute(types.AttributeKeyLiquidatedOwner, deposit.Depositor.String()),
sdk.NewAttribute(types.AttributeKeyLiquidatedCoins, liquidatedCoins.String()),
sdk.NewAttribute(types.AttributeKeyKeeper, keeper.String()),
sdk.NewAttribute(types.AttributeKeyKeeperRewardCoins, keeperRewardCoins.String()),
),
)
}
// Returns nil if there's no error
return err
}
// StartAuctions attempts to start auctions for seized assets
func (k Keeper) StartAuctions(ctx sdk.Context, borrower sdk.AccAddress, borrows, deposits sdk.Coins,
depositCoinValues, borrowCoinValues types.ValuationMap, ltv sdk.Dec, liqMap map[string]LiqData,
) (sdk.Coins, error) {
// Sort keys to ensure deterministic behavior
bKeys := borrowCoinValues.GetSortedKeys()
dKeys := depositCoinValues.GetSortedKeys()
// Set up auction constants
returnAddrs := []sdk.AccAddress{borrower}
weights := []sdkmath.Int{sdkmath.NewInt(100)}
debt := sdk.NewCoin("debt", sdk.ZeroInt())
macc := k.accountKeeper.GetModuleAccount(ctx, types.ModuleAccountName)
maccCoins := k.bankKeeper.SpendableCoins(ctx, macc.GetAddress())
var liquidatedCoins sdk.Coins
for _, bKey := range bKeys {
bValue := borrowCoinValues.Get(bKey)
maxLotSize := bValue.Quo(ltv)
for _, dKey := range dKeys {
dValue := depositCoinValues.Get(dKey)
if maxLotSize.Equal(sdk.ZeroDec()) {
break // exit out of the loop if we have cleared the full amount
}
if dValue.GTE(maxLotSize) { // We can start an auction for the whole borrow amount]
bid := sdk.NewCoin(bKey, borrows.AmountOf(bKey))
lotSize := maxLotSize.MulInt(liqMap[dKey].conversionFactor).Quo(liqMap[dKey].price)
if lotSize.TruncateInt().Equal(sdk.ZeroInt()) {
continue
}
lot := sdk.NewCoin(dKey, lotSize.TruncateInt())
insufficientLotFunds := false
if lot.Amount.GT(maccCoins.AmountOf(dKey)) {
insufficientLotFunds = true
lot = sdk.NewCoin(lot.Denom, maccCoins.AmountOf(dKey))
}
// Sanity check that we can deliver coins to the liquidator account
if deposits.AmountOf(dKey).LT(lot.Amount) {
return liquidatedCoins, types.ErrInsufficientCoins
}
// Start auction: bid = full borrow amount, lot = maxLotSize
_, err := k.auctionKeeper.StartCollateralAuction(ctx, types.ModuleAccountName, lot, bid, returnAddrs, weights, debt)
if err != nil {
return liquidatedCoins, err
}
// Decrement supplied coins and decrement borrowed coins optimistically
err = k.DecrementSuppliedCoins(ctx, sdk.Coins{lot})
if err != nil {
return liquidatedCoins, err
}
err = k.DecrementBorrowedCoins(ctx, sdk.Coins{bid})
if err != nil {
return liquidatedCoins, err
}
// Add lot to liquidated coins
liquidatedCoins = liquidatedCoins.Add(lot)
// Update USD valuation maps
borrowCoinValues.SetZero(bKey)
depositCoinValues.Decrement(dKey, maxLotSize)
// Update deposits, borrows
borrows = borrows.Sub(bid)
if insufficientLotFunds {
deposits = deposits.Sub(sdk.NewCoin(dKey, deposits.AmountOf(dKey)))
} else {
deposits = deposits.Sub(lot)
}
// Update max lot size
maxLotSize = sdk.ZeroDec()
} else { // We can only start an auction for the partial borrow amount
maxBid := dValue.Mul(ltv)
bidSize := maxBid.MulInt(liqMap[bKey].conversionFactor).Quo(liqMap[bKey].price)
bid := sdk.NewCoin(bKey, bidSize.TruncateInt())
lot := sdk.NewCoin(dKey, deposits.AmountOf(dKey))
if bid.Amount.Equal(sdk.ZeroInt()) || lot.Amount.Equal(sdk.ZeroInt()) {
continue
}
insufficientLotFunds := false
if lot.Amount.GT(maccCoins.AmountOf(dKey)) {
insufficientLotFunds = true
lot = sdk.NewCoin(lot.Denom, maccCoins.AmountOf(dKey))
}
// Sanity check that we can deliver coins to the liquidator account
if deposits.AmountOf(dKey).LT(lot.Amount) {
return liquidatedCoins, types.ErrInsufficientCoins
}
// Start auction: bid = maxBid, lot = whole deposit amount
_, err := k.auctionKeeper.StartCollateralAuction(ctx, types.ModuleAccountName, lot, bid, returnAddrs, weights, debt)
if err != nil {
return liquidatedCoins, err
}
// Decrement supplied coins and decrement borrowed coins optimistically
err = k.DecrementSuppliedCoins(ctx, sdk.Coins{lot})
if err != nil {
return liquidatedCoins, err
}
err = k.DecrementBorrowedCoins(ctx, sdk.Coins{bid})
if err != nil {
return liquidatedCoins, err
}
// Add lot to liquidated coins
liquidatedCoins = liquidatedCoins.Add(lot)
// Update variables to account for partial auction
borrowCoinValues.Decrement(bKey, maxBid)
depositCoinValues.SetZero(dKey)
borrows = borrows.Sub(bid)
if insufficientLotFunds {
deposits = deposits.Sub(sdk.NewCoin(dKey, deposits.AmountOf(dKey)))
} else {
deposits = deposits.Sub(lot)
}
// Update max lot size
maxLotSize = borrowCoinValues.Get(bKey).Quo(ltv)
}
}
}
// Send any remaining deposit back to the original borrower
for _, dKey := range dKeys {
remaining := deposits.AmountOf(dKey)
if remaining.GT(sdk.ZeroInt()) {
returnCoin := sdk.NewCoins(sdk.NewCoin(dKey, remaining))
err := k.bankKeeper.SendCoinsFromModuleToAccount(ctx, types.ModuleAccountName, borrower, returnCoin)
if err != nil {
return liquidatedCoins, err
}
}
}
return liquidatedCoins, nil
}
// IsWithinValidLtvRange compares a borrow and deposit to see if it's within a valid LTV range at current prices
func (k Keeper) IsWithinValidLtvRange(ctx sdk.Context, deposit types.Deposit, borrow types.Borrow) (bool, error) {
liqMap, err := k.LoadLiquidationData(ctx, deposit, borrow)
if err != nil {
return false, err
}
totalBorrowableUSDAmount := sdk.ZeroDec()
for _, depCoin := range deposit.Amount {
lData := liqMap[depCoin.Denom]
usdValue := sdk.NewDecFromInt(depCoin.Amount).Quo(sdk.NewDecFromInt(lData.conversionFactor)).Mul(lData.price)
borrowableUSDAmountForDeposit := usdValue.Mul(lData.ltv)
totalBorrowableUSDAmount = totalBorrowableUSDAmount.Add(borrowableUSDAmountForDeposit)
}
totalBorrowedUSDAmount := sdk.ZeroDec()
for _, coin := range borrow.Amount {
lData := liqMap[coin.Denom]
usdValue := sdk.NewDecFromInt(coin.Amount).Quo(sdk.NewDecFromInt(lData.conversionFactor)).Mul(lData.price)
totalBorrowedUSDAmount = totalBorrowedUSDAmount.Add(usdValue)
}
// Check if the user's has borrowed more than they're allowed to
if totalBorrowedUSDAmount.GT(totalBorrowableUSDAmount) {
return false, nil
}
return true, nil
}
// GetStoreLTV calculates the user's current LTV based on their deposits/borrows in the store
// and does not include any outsanding interest.
func (k Keeper) GetStoreLTV(ctx sdk.Context, addr sdk.AccAddress) (sdk.Dec, error) {
// Fetch deposits and parse coin denoms
deposit, found := k.GetDeposit(ctx, addr)
if !found {
return sdk.ZeroDec(), nil
}
// Fetch borrow balances and parse coin denoms
borrow, found := k.GetBorrow(ctx, addr)
if !found {
return sdk.ZeroDec(), nil
}
return k.CalculateLtv(ctx, deposit, borrow)
}
// CalculateLtv calculates the potential LTV given a user's deposits and borrows.
// The boolean returned indicates if the LTV should be added to the store's LTV index.
func (k Keeper) CalculateLtv(ctx sdk.Context, deposit types.Deposit, borrow types.Borrow) (sdk.Dec, error) {
// Load required liquidation data for every deposit/borrow denom
liqMap, err := k.LoadLiquidationData(ctx, deposit, borrow)
if err != nil {
return sdk.ZeroDec(), nil
}
// Build valuation map to hold deposit coin USD valuations
depositCoinValues := types.NewValuationMap()
for _, depCoin := range deposit.Amount {
dData := liqMap[depCoin.Denom]
dCoinUsdValue := sdk.NewDecFromInt(depCoin.Amount).Quo(sdk.NewDecFromInt(dData.conversionFactor)).Mul(dData.price)
depositCoinValues.Increment(depCoin.Denom, dCoinUsdValue)
}
// Build valuation map to hold borrow coin USD valuations
borrowCoinValues := types.NewValuationMap()
for _, bCoin := range borrow.Amount {
bData := liqMap[bCoin.Denom]
bCoinUsdValue := sdk.NewDecFromInt(bCoin.Amount).Quo(sdk.NewDecFromInt(bData.conversionFactor)).Mul(bData.price)
borrowCoinValues.Increment(bCoin.Denom, bCoinUsdValue)
}
// User doesn't have any deposits, catch divide by 0 error
sumDeposits := depositCoinValues.Sum()
if sumDeposits.Equal(sdk.ZeroDec()) {
return sdk.ZeroDec(), nil
}
// Loan-to-Value ratio
return borrowCoinValues.Sum().Quo(sumDeposits), nil
}
// LoadLiquidationData returns liquidation data, deposit, borrow
func (k Keeper) LoadLiquidationData(ctx sdk.Context, deposit types.Deposit, borrow types.Borrow) (map[string]LiqData, error) {
liqMap := make(map[string]LiqData)
borrowDenoms := getDenoms(borrow.Amount)
depositDenoms := getDenoms(deposit.Amount)
denoms := removeDuplicates(borrowDenoms, depositDenoms)
// Load required liquidation data for every deposit/borrow denom
for _, denom := range denoms {
mm, found := k.GetMoneyMarket(ctx, denom)
if !found {
return liqMap, errorsmod.Wrapf(types.ErrMarketNotFound, "no market found for denom %s", denom)
}
priceData, err := k.pricefeedKeeper.GetCurrentPrice(ctx, mm.SpotMarketID)
if err != nil {
return liqMap, err
}
liqMap[denom] = LiqData{priceData.Price, mm.BorrowLimit.LoanToValue, mm.ConversionFactor}
}
return liqMap, nil
}
func getDenoms(coins sdk.Coins) []string {
denoms := []string{}
for _, coin := range coins {
denoms = append(denoms, coin.Denom)
}
return denoms
}
func removeDuplicates(one []string, two []string) []string {
check := make(map[string]int)
fullList := append(one, two...)
res := []string{}
for _, val := range fullList {
check[val] = 1
}
for key := range check {
res = append(res, key)
}
sort.Strings(res)
return res
}