Lending/Borrowing Protocol

A simplified lending and borrowing protocol inspired by Aave/Compound, built with Solidity and Hardhat.

Features

• Deposit tokens as collateral
• Borrow against collateral
• Dynamic interest rate model
• Liquidation mechanism
• Price oracle integration
• Reentrancy protection
• Access control

Smart Contracts

1. MockToken.sol: A simple ERC20 token for testing
2. InterestRateModel.sol: Implements a simplified version of Compound's interest rate model
3. PriceOracle.sol: Provides price feeds for collateral valuation
4. LendingPool.sol: Main contract handling deposits, withdrawals, borrowing, and liquidations

Key Parameters

• Collateral Factor: 75%
• Liquidation Threshold: 80%
• Liquidation Penalty: 5%
• Reserve Factor: 10%

Interest Rate Model

The protocol uses a kinked interest rate model:

• Base Rate: 2% per year
• Multiplier: 20% per year
• Kink: 80% utilization
• Jump Multiplier: 50% per year

Security Features

• ReentrancyGuard for all external functions
• Access control for admin functions
• Price oracle with minimum update intervals
• Collateral and liquidation checks
• Safe math operations

Development

Prerequisites

• Node.js
• npm
• Hardhat

Installation

npm install

Compile Contracts

npx hardhat compile

Run Tests

npx hardhat test

Deploy

npx hardhat run scripts/deploy.ts --network <network>

Usage

1. Deploy the contracts using the deployment script
2. Set up the price oracle with initial prices
3. Users can:
   • Deposit tokens as collateral
   • Borrow against their collateral
   • Repay their loans
   • Withdraw their collateral
   • Liquidate undercollateralized positions

Security Considerations

This is a simplified version of a lending protocol and should not be used in production without:

• Comprehensive testing
• Security audits
• Economic modeling
• Risk management systems
• Proper oracle integration
• Emergency pause functionality
• Governance mechanisms

License

MIT