Via Scallop
What is Scallop
Scallop is a lending protocol within the Sui ecosystem, offering a platform where lenders can earn interest, while borrowers can obtain leverage.
How it Works
Consider a user with an initial position of 10 SUI, aiming for 2x Leverage.
User provides 10 SUI.
Flash loan 10 SUI from Bucket.
Stake 20 SUI, resulting in 20 LST.
Deposits 20 LST and borrows 10 SUI from Scallop.
Repay the flash loan.
In summary
Asset: 20 LST SUI
Debt: 10 SUI
Equity: 10 SUI
Fee
For this service, a 0.2% fee is applied upfront.
Additional Note
In the third step, during the staking process, the amount of LST may be slightly less than 20 due to its characteristics, for example, 19.99 LST. However, this still represents an underlying value of 20 SUI and does not affect the overall leverage.
The details for simple leverage are as follows: 1. User provides 10 SUI. 2. Flash loans 10 SUI (via Bucket). 3. Deposits 20 SUI and borrows 10 SUI (in the form of USDC) (via Scallop). 4. Swaps USDC for SUI (via Cetus). 5. Repays the flash loan.
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