Getting Started

Axiom Labs is a decentralized protocol that allows its users access high liquidity against their assets at an interest rate. Users can quickly obtain liquidity by securing various listed assets as collateral in a smart contract to establish a vault position. This allows them to mint $AXUSD, a stablecoin pegged to the USD. Each vault must maintain collateralization of at least%, ensuring stability. $AXUSD holders retain the option to exchange their stablecoins for the underlying collateral at any point, supported by a redemption mechanism and dynamically adjusted fees to uphold a minimum stablecoin value of USD 1. This system introduces an innovative liquidation mechanism, setting a new standard in decentralized finance. - inspired by ERD

Major Use Cases - $AXUSD

• $AXUSD is yield-bearing and can be supplied to our lending and borrowing partners for users to earn interest.

• Contribute $AXUSD to the balancer pool in return for rewards for keeping the Axiom liquidation process running smoothly.

• Borrow $AXUSD by opening a vault and depositing collateral

Fees

There is a one-time fee charged each time $AXUSD is borrowed and when it is exchanged:

Borrowers incur a fee based on a percentage of their $AXUSD withdrawal amount, along with additional interest charges. Refer to our interest model for more specifics.

On the other hand, redeemers face a fee when converting $AXUSD back to collateral, which is separate from borrower repayment.

Both fees are influenced by redemption volumes, meaning they rise with each redemption relative to the redeemed amount and decrease over time in the absence of redemptions. This strategy aims to regulate large redemptions with higher fees and to moderate borrowing immediately after significant redemption activity. Fee reduction over time ensures that both borrowers and redeemers experience diminishing fees during periods of low redemption volumes. However, fees cannot drop below 0.25% to prevent exploitation by arbitrageurs preempting the price feed. The borrowing fee is capped at 5% to maintain the system's appeal to borrowers, even during phases of monetary contraction due to redemptions. Otherwise, both fees function identically.

The axiom protocol applies a one-time borrowing and redemption fee, which dynamically adjusts based on the time of the last redemption. For instance, if redemptions increase (indicating a potential drop in $AXUSD trading price below $1), borrowing costs will rise to deter borrowing activity. Additionally, while you hold your position, we impose minimal fees determined by the vault collateral ratio and overall protocol conditions. With one-time borrowing and redemption fees in place, our goal is to maintain the lowest possible interest rates while ensuring protocol robustness. For more insight into the interest rate model, please consult the debt interest rate model.