TaoBank
  • TaoBank overview
    • Problem Statement
    • How TaoBank Stands Out
  • Protocol
    • Our stablecoin: taoUSD
    • Minting $taoUSD
    • Vaults
      • Issuance Fee
    • Redemptions
    • Liquidations
    • Oracles
  • Tokenomics
    • Our revenue sharing token: TBANK
  • Future Roadmap (February 2025 Update)
    • CEX Listings (Ongoing)
    • Enhanced Liquidity Partnerships (Ongoing)
    • New products (Ongoing)
    • Governance and Community Engagement (Ongoing)
    • Expansion to Bittensor (Q1 2025)
    • Expansion to Solana (Q1-Q2 2025)
    • Liquid Staking Derivatives for Dynamic TAO (Q2–Q3 2025)
    • Maximizing Staking Returns for wTAO Holders (Ongoing)
  • Official Links
    • Twitter
    • Website
    • Telegram
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  1. Protocol

Liquidations

In case of liquidations, Vaults are offered on a Dutch auction where bidders can buy the collateral assets for $taoUSD.

The initial price of the Vault is set to the value of the collateral. Then, the price gradually drops over the specified time period (voted via governance), enabling the bidders to realize an immediate arbitrage gain as the value of the Vault debt is usually expected to be lower than the value of the collateral assets.

If there are no bidders during the Dutch Auction, the auction is canceled and the liquidation is handled by the protocol.

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Last updated 1 year ago

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