# Table of Contents - [Welcome to Felix | Felix](#welcome-to-felix-felix) - [Contributors | Felix](#contributors-felix) - [Overview | Felix](#overview-felix) - [How it Works | Felix](#how-it-works-felix) - [Points and Incentives | Felix](#points-and-incentives-felix) - [CDP Market (feUSD) | Felix](#cdp-market-feusd-felix) - [Minting / Borrowing feUSD | Felix](#minting-borrowing-feusd-felix) - [How it Works | Felix](#how-it-works-felix) - [FAQ | Felix](#faq-felix) - [Privacy Policy | Felix](#privacy-policy-felix) - [Vanilla Markets | Felix](#vanilla-markets-felix) - [Cookie Policy | Felix](#cookie-policy-felix) - [Smart Contract Audits | Felix](#smart-contract-audits-felix) - [Market 1: feUSD CDP | Felix](#market-1-feusd-cdp-felix) - [FAQ | Felix](#faq-felix) - [Risk Management | Felix](#risk-management-felix) - [Managing your borrow position | Felix](#managing-your-borrow-position-felix) - [Market 2: Vanilla | Felix](#market-2-vanilla-felix) - [Risk Disclosure Statement | Felix](#risk-disclosure-statement-felix) - [Earning feUSD yield | Felix](#earning-feusd-yield-felix) - [Terms & Conditions | Felix](#terms-conditions-felix) - [Smart Contract Audits | Felix](#smart-contract-audits-felix) --- # Welcome to Felix | Felix ![Page cover](https://usefelix.gitbook.io/docs/~gitbook/image?url=https%3A%2F%2F2357968670-files.gitbook.io%2F%7E%2Ffiles%2Fv0%2Fb%2Fgitbook-x-prod.appspot.com%2Fo%2Fspaces%252FVH6och7EAxl0pIZxgbqv%252Fuploads%252FnC6HhX4Ul6RoE1DuuMfh%252F1500x500%2520%284%29.jpeg%3Falt%3Dmedia%26token%3De81e3fb0-d7fb-4d35-a41d-b61f7c70de5e&width=1248&dpr=4&quality=100&sign=f4230d34&sv=2) Felix is a **suite of on‑chain borrowing and lending products** running on **Hyperliquid L1**. Our goal is to let anyone unlock liquidity or earn yield in a secure, risk‑adjusted, and friction‑free way. Felix currently provides **three core primitives**: Primitive What It Does Who It’s For [**CDP Market (feUSD)**](https://usefelix.gitbook.io/docs/money-market-products/quickstart) Deposit collateral → mint feUSD -> swap into another asset for leverage. Traders seeking high‑LTV leverage and cheap borrow costs. [**Vanilla Markets**](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs) Variable‑rate lending pools. Borrow asset‑native tokens (e.g., HYPE, HUSD, USDC) or supply them to earn APY. Users who prefer direct exposure to the asset they borrow/lend—no redemption mechanics, fully dynamic rates. * * * ### [](https://usefelix.gitbook.io/docs#popular-use-cases) Popular Use‑Cases * **Margin Trade:** Use the CDP or Vanilla Markets to lever up long/short positions without leaving Hyperliquid. * **HLP Carry Trade:** Borrow feUSD at a fixed rate of your choosing or borrow a fiat stable, swap into USDC -> deposit into HLP, and capture funding differentials. * **SP Carry Trade:** Mint feUSD → deposit in a Stability Pool → earn spread between your borrow rate and pool yield. * **Spot Trades:** Mint feUSD or borrow USDC/HYPE for immediate spot purchases on Hyperliquid DEXs. * **Leverage Looping:** Deposit collateral → borrow the same asset in Vanilla → re‑deposit, amplifying exposure. * **Yield on Stables**: Park idle feUSD in Stability Pools or lend HUSD / USDC in Vanilla for yield. * **DEX LPing** * **Volatile pairs:** Provide liquidity to pairs like **HYPE/feUSD** or **UBTC/feUSD** to earn swap fees * **Stable-swap pairs:** Supply liquidity to pools such as **HUSD/USDC**, **USDT0/USDC**, or **USDe/feUSD** to collect low-impermanent-loss fees. [NextContributors](https://usefelix.gitbook.io/docs/contributors) Last updated 4 months ago --- # Contributors | Felix * The Felix protocol has contributors from the Felix Foundation. * Felix also has contributors from and partnerships with engineering firm [Three Sigma](https://threesigma.xyz/) and risk management firm [Anthias Labs](https://anthias.xyz/) . * Felix has been incubated by the Hyperliquid-native angel syndicate HyperActive. **How to contribute** If you would like to contribute to Felix, join the Felix Discord linked below and open a support ticket. [PreviousWelcome to Felix](https://usefelix.gitbook.io/docs) [NextOverview](https://usefelix.gitbook.io/docs/money-market-products/overview) Last updated 6 months ago --- # Overview | Felix Felix offers a suite of products that allow users to borrow against collateral and lend assets in a secure, risk-adjusted, and simple manner. Felix offers **two core primitives**: * [CDP Market (feUSD)](https://usefelix.gitbook.io/docs/money-market-products/quickstart) * [Vanilla Markets](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs) For product feedback and feature requests, please drop a message in the Felix Discord. [PreviousContributors](https://usefelix.gitbook.io/docs/contributors) [NextPoints and Incentives](https://usefelix.gitbook.io/docs/money-market-products/points-and-incentives) Last updated 6 months ago --- # How it Works | Felix [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/how-it-works#how-the-cdp-market-feusd-works) How the CDP Market (feUSD) works ------------------------------------------------------------------------------------------------------------------------------------------------------- feUSD is a CDP stablecoin protocol. As stated in this [page](https://usefelix.gitbook.io/docs/money-market-products/quickstart) , it functions as a money market between feUSD minters / borrowers and stability pool depositors. With the CDP Market (feUSD), users can permissionlessly use various tokens as collateral to mint **feUSD**, a stablecoin pegged to the U.S. dollar. feUSD can then be used to swap into other assets - this effectively is a form of leverage. Felix is an **over-collateralized system.** Over-collateralization provides a safety buffer to protect the system against market volatility and to ensure that feUSD maintains solvency. feUSD has no centralized custodian and relies on liquidators and redeemers to ensure that circulating feUSD is wholly backed. [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/how-it-works#key-risks-per-user-type) Key Risks per User Type --------------------------------------------------------------------------------------------------------------------------------------- User Primary Risks **Minters / Borrowers** **Liquidation risk** if collateral value falls above LTV. **Redemption risk** if feUSD trades below $1 and arbitrageurs redeem against their position. **Stability-Pool Depositors** **Liquidation volatility** – their feUSD is burned during liquidations and they receive volatile collateral instead. **feUSD DEX LPs** **Impermanent loss** from feUSD <> Other asset price moves [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/how-it-works#key-components-to-the-felix-protocol) Key Components to the Felix Protocol ----------------------------------------------------------------------------------------------------------------------------------------------------------------- There are two key challenges involved in maintaining the Felix CDP stablecoin system: 1. **Maintaining the $1 feUSD Peg** * Ensuring that feUSD consistently trades at or very close to $1.00 is crucial * Price deviations can undermine both borrowing and saving activity 2. **Efficient Processing of Liquidations** * Swift and fair liquidation processes protect the protocol from accumulating bad debt * Efficient liquidations ensure that the protocol maintains its solvency ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/how-it-works#peg-maintenance-feusd-redemption-mechanics) Peg Maintenance: feUSD Redemption Mechanics Redemptions allow feUSD holders to exchange their feUSD directly for $1-worth of collateral at face value from the protocol. Redemptions are processed against open positions in order of those paying the lowest rate of interest first. Positions that are redeemed against are not charged a penalty like they would be in the event of an liquidation, but do effectively lose directional exposure to their deposited collateral. #### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/how-it-works#how-redemptions-help-maintain-the-peg) **How Redemptions Help Maintain the Peg:** This mechanism creates an arbitrage opportunity whereby any feUSD acquired below-peg on secondary markets can be used to purchase liquid collateral assets for a profit. Moreover, redemptions reduce the circulating supply of feUSD, helping to push its market price back towards peg. #### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/how-it-works#redemption-process) **Redemption Process** 1. **Initiation:** A user sends a specified amount of feUSD to the protocol for redemption. 2. **Debt Reduction:** Protocol reduces the debt of all positions needed to meet the redeemed amount 3. **Collateral Transfer:** $1 of collateral per feUSD redeemed minus a fee is transferred to the user 4. **Equilibrium Rate:** Protocol now has a higher average rate of interest across open positions ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/how-it-works#efficient-liquidations-stability-pool-vaults) Efficient Liquidations: Stability Pool Vaults Felix allows users to deposit into dedicated pools ("vaults") corresponding to each supported collateral asset. These deposits are used to absorb the debt of positions denominated in the collateral asset when they fall below their liquidation threshold. Users are paid per block for providing this capital with the lion's share of the interest generated by the debt backed by the target collateral asset, and are entitled to liquidation profits as their capital is tapped. **How the Stability Pool Vault Works** * **Debt Absorption:** When a borrower position is liquidated, its outstanding debt is netted out against feUSD in the Stability Pool via burning. * **Collateral Distribution:** The collateral from the liquidated borrower position is distributed proportionally across Stability Pool depositors. [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/how-it-works#understanding-redemptions) Understanding Redemptions ------------------------------------------------------------------------------------------------------------------------------------------- The walk‑through below shows how a real redemption impacts borrowers / minters: #### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/how-it-works#scenario-feusd-trades-at-usd0.993) Scenario: feUSD trades at $0.993 1. **Market dislocation** – selling pressure nudges feUSD to **$0.993** (‑0.7 %). 2. **Arbitrage set‑up** – Alice buys **500,000 feUSD** on a DEX for **$496,500** worth of HYPE (a $3,500 discount). 3. **Redemption TX** – she calls `redeem()` with the 500,000 feUSD. #### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/how-it-works#how-the-queue-is-processed) How the queue is processed CDP (before) Debt (feUSD) Collateral Value Borrower‑set Rate Bob 300,000 $450,000 **1.0 %** Carol 400,000 $600,000 **2.0 %** Dave 600,000 $900,000 **3.0 %** Debt is cancelled from the **lowest‑rate positions first**: CDP (after) Debt Repaid by Redemption Remaining Debt Collateral Seized Bob 300,000 (100 %) 0 $300000 HYPE Carol 200,000 (50 %) 200,000 $200000 HYPE Dave 0 600,000 – #### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/how-it-works#impact-on-interest-rate-distribution) Impact on interest‑rate distribution Metric Before After Total System Debt 1.30 M feUSD **0.80 M feUSD** Weighted Avg. Rate 2.46 % **2.75 %** #### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/how-it-works#take-aways-for-each-actor) Take‑aways for each actor * **Arbitrageur** – locks in arbitrage profit (spread − fee) minus gas. * **Borrowers** – Bob exits; Carol’s debt/collateral shrink; Dave unchanged. This concrete flow shows how redemptions nudge the peg even during small deviations and organically re‑price the debt book toward equilibrium. * * * [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/how-it-works#understanding-liquidations) Understanding Liquidations --------------------------------------------------------------------------------------------------------------------------------------------- Liquidation occurs when borrow position health falls below a certain threshold, which varies with each supported collateral asset. This can happen when either the value of the position collateral decreases. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/how-it-works#liquidation-health-and-collateralization-ratio) **Liquidation Health and Collateralization Ratio** The Collateralization Ratio (CR) measures the health of your loan: Collateralization Ratio (CR)\=(Value of CollateralValue of Debt)×100%\\text{Collateralization Ratio (CR)} = \\left( \\frac{\\text{Value of Collateral}}{\\text{Value of Debt}} \\right) \\times 100\\% Collateralization Ratio (CR)\=(Value of DebtValue of Collateral​)×100% If you deposit $1,500 worth of HYPE and borrow 1,000 feUSD, your CR is: CR\=(1,5001,000)×100%\=150%\\text{CR} = \\left( \\frac{1,500}{1,000} \\right) \\times 100\\% = 150\\%CR\=(1,0001,500​)×100%\=150% ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/how-it-works#avoiding-liquidation) **Avoiding Liquidation** * **Monitor Your CR:** Keep an eye on market prices to ensure your CR remains healthy. * **Add More Collateral:** If your CR is dropping, you can deposit more collateral to improve it. * **Repay feUSD Debt:** Reducing your debt increases your CR. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/how-it-works#liquidation-sequence) **Liquidation Sequence** * **Collateral Seizure:** If your CR falls below the liquidation threshold, your collateral is seized to repay your debt plus a bonus for the liquidator. * **Retention of feUSD:** You still retain the feUSD you borrowed. * **Position Closure:** Your debt position is effectively closed through liquidation. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/how-it-works#example-scenario) **Example Scenario** * **Liquidation Event:** A borrower's position falls below the liquidation threshold * **Debt Cancellation:** The borrower's debt is canceled using feUSD from the Stability Pool * **Collateral Allocation:** The seized collateral is distributed to Stability Pool depositors pro rata * **Depositor Gains:** Depositors receive collateral assets plus a liquidation bonus [PreviousCDP Market (feUSD)](https://usefelix.gitbook.io/docs/money-market-products/quickstart) [NextMinting / Borrowing feUSD](https://usefelix.gitbook.io/docs/money-market-products/quickstart/quickstart) Last updated 4 months ago --- # Points and Incentives | Felix Users can earn points for their usage of Felix. There is no public end date or recommendations on how to earn points. Furthermore, as a part of our licensing agreement with Liquity, mainnet users of BOLD also qualify for a separate incentives program. [PreviousOverview](https://usefelix.gitbook.io/docs/money-market-products/overview) [NextCDP Market (feUSD)](https://usefelix.gitbook.io/docs/money-market-products/quickstart) Last updated 6 months ago --- # CDP Market (feUSD) | Felix [](https://usefelix.gitbook.io/docs/money-market-products/quickstart#overview) Overview -------------------------------------------------------------------------------------------- The feUSD CDP Market is a money market that brings together feUSD borrowers / minters and Stability Pool depositors. It uses the Liquity v2 architecture. It is a **CDP stablecoin protocol** that matches two economic actors: Side Role What they supply What they earn **Borrowers / Minters** Deposit collateral and mint feUSD Collateral (e.g. HYPE, UBTC, LSTs …) Pay an up‑front borrow fee + an interest rate they set themselves **Stability‑Pool (SP) Depositors** Provide passive liquidity to absorb liquidations feUSD bought on the secondary market Earn the borrowers’ interest, a share of up‑front fees, and any liquidation gains As a money market, the protocol’s job is to bring these two sides into **rate equilibrium**: borrowers compete to post an attractive rate, while SP depositors decide whether the offered return compensates them for risk. [](https://usefelix.gitbook.io/docs/money-market-products/quickstart#why-use-the-cdp-to-borrow-feusd) Why use the CDP to borrow feUSD? ------------------------------------------------------------------------------------------------------------------------------------------- * **Set your own interest rate** → discover the cheapest cost of capital in real‑time. * **Capital efficiency** → highest loan‑to‑value (LTV) due to the Stability Pool design. Because liquidations are absorbed by the Stability Pool rather than by liquidators into the secondary markets, each additional dollar in SP liquidity safely supports a larger system‑wide debt load. Borrowers can therefore unlock **more liquidity per unit of collateral** compared to other money market models. #### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart#borrowers-of-feusd-must-be-aware-of) Borrowers of feUSD must be aware of * **Liquidations** — positions that go above the LTV can be liquidated into the Stability Pool. * **Redemptions** — when feUSD trades below $1, arbitrageurs can redeem feUSD for $1 of collateral, starting with the positions with the lowest interest rate. This affects positions with low interest rates. [](https://usefelix.gitbook.io/docs/money-market-products/quickstart#why-deposit-feusd-into-the-stability-pool) Why deposit feUSD into the Stability Pool? --------------------------------------------------------------------------------------------------------------------------------------------------------------- SP depositors purchase feUSD on the secondary market and deposit it into the pool to earn: * Streaming interest paid by borrowers. * A share of up‑front borrow fees. * Liquidation gains in the form of discounted collateral (event‑driven, not guaranteed). #### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart#feusd-stability-pool-depositors-must-be-aware-of) feUSD Stability Pool depositors must be aware of * **Liquidations** — during liquidations your feUSD is burned and you receive the respective collateral of the pool you deposited into instead (E.g. HYPE for the HYPE Stability Pool, exposing you to its price volatility. [](https://usefelix.gitbook.io/docs/money-market-products/quickstart#introduction) Accepted Collaterals ------------------------------------------------------------------------------------------------------------ Collateral LTV Oracle HYPE ~59% Redstone UBTC 50.00% Redstone [PreviousPoints and Incentives](https://usefelix.gitbook.io/docs/money-market-products/points-and-incentives) [NextHow it Works](https://usefelix.gitbook.io/docs/money-market-products/quickstart/how-it-works) Last updated 6 months ago --- # Minting / Borrowing feUSD | Felix ![](https://usefelix.gitbook.io/docs/~gitbook/image?url=https%3A%2F%2F2357968670-files.gitbook.io%2F%7E%2Ffiles%2Fv0%2Fb%2Fgitbook-x-prod.appspot.com%2Fo%2Fspaces%252FVH6och7EAxl0pIZxgbqv%252Fuploads%252F4hEjzN1t1uUnSOaTupx3%252F5%2520-%2520Earn%2520-%2520After%2520clicking%2520_Earn_.png%3Falt%3Dmedia%26token%3Dc1a79192-6bcc-4ed5-8d5c-2258bd5b60ec&width=768&dpr=4&quality=100&sign=f28c6472&sv=2) ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/quickstart#introduction) Introduction On mainnet, users can deposit HYPE and UBTC as collateral within the Felix protocol and borrow feUSD. When tokens are supplied, they are transferred to the Felix Protocol, a system of smart contracts that facilitates overcollateralized borrowing of tokens. Borrower interest rates are influenced by on-chain inputs such as token balances, oracle prices, and the borrow utilization ratio. As liquidity is supplied, borrowed, repaid, or withdrawn from the pool, the interest rates are updated accordingly. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/quickstart#introduction-1) Key Risks to be Aware Of Risk What Triggers It What Happens How to Mitigate **Liquidations** Your account / position health falls below 1. • The protocol cancels your debt by burning feUSD from the Stability Pool. • Your collateral (plus a small penalty) is transferred to Stability-Pool depositors. • You keep any feUSD you previously borrowed, but your position is closed. • Keep account / position health comfortably above the threshold (1.25–1.50 is common). • Set up on-chain alerts or use Felix’s health-check notifications. • Add collateral or repay feUSD when health drifts lower. **Redemptions** The market price of feUSD trades **≤ $0.995**. Arbitrageurs buy cheap feUSD and invoke `redeem()` to swap it for collateral. The system cancels debt starting with **the lowest-interest-rate positions first**. • Part of your debt is repaid (good), but you _lose collateral_ at face value ($1 per feUSD) without the liquidation penalty. • Your effective **borrow rate rises** because only higher-rate debt remains. • If you set an _aggressively low rate_, your position will be tapped first. • Price your borrow rate in line with market (look at the median shown in the UI). • Track feUSD price; if it slips toward $0.995, consider adjusting your rate upward. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/quickstart#step-1-connect-wallet) Step 1: Connect Wallet To begin, press ‘Connect Wallet’ and select your preferred wallet provider corresponding to the wallet holding tokens you intend to deposit as collateral. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/quickstart#step-2-select-token-to-supply) Step 2: Select Token To Collateralize Once connected, navigate to the ‘Borrow’ page where you’ll find the ‘New Positions’ table, which lists supported collateral, current token balances, and asset parameters. Find the collateral that you want to deposit into Felix, and click the borrow button on the right. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/quickstart#step-2-select-token-to-supply-1) Step 3: Select amount to collateralize and feUSD borrow amount In the modal that pops up on the right, select the amount that you want to deposit as collateral, and the amount of feUSD that you want to borrow. Ensure that you maintain a safe collateralization ratio to avoid liquidation. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/quickstart#step-2-select-token-to-supply-2) Step 4: Set your interest rate You will default receive the median fixed interest rate for your borrow position. On Felix, you can choose your own interest rate by clicking the gear icon on the modal and then shifting the circle on the bar to your interest rate of choice. Lower interest rates are redeemed first (See more about feUSD redemptions in this [section](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs/how-it-works) of the Felix docs). ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/quickstart#step-3-approve-token-transfer) Step 5: Approve Token Transfer After clicking the confirm button, a modal will appear that will prompt a transaction or message signature request in the connected wallet. In order to transfer tokens on the Hyperliquid L1 network, the Felix smart contract must be granted an allowance to transfer tokens from the connected wallet address. Approvals can be performed through transaction. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/quickstart#step-4-perform-supply-transaction) Step 6: Perform Supply Transaction After the approval transaction, there will be one more request to confirm the transaction of depositing your collateral into the protocol and borrowing feUSD. Once you click confirm, you should be good to go in a few seconds! [PreviousHow it Works](https://usefelix.gitbook.io/docs/money-market-products/quickstart/how-it-works) [NextManaging your borrow position](https://usefelix.gitbook.io/docs/money-market-products/quickstart/publish-your-docs) Last updated 6 months ago --- # How it Works | Felix [](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs/how-it-works#how-the-vanilla-markets-work) How the Vanilla Markets Work -------------------------------------------------------------------------------------------------------------------------------------------------------- Vanilla Markets match asset suppliers (lenders) with collateralised borrowers in real time. Unlike the feUSD CDP system, there are **no redemptions or fixed borrower‑set rates**—pricing is entirely driven by the utilisation curve. * Borrowers post collateral (HYPE, UBTC, ETH …) and borrow the asset of their choosing—for example USDC or HYPE itself. * Lenders supply those same assets and earn yield when there is borrow demand. * Interest rates float block‑by‑block based on the pool’s utilisation: higher utilisation ⇒ higher APR for borrowers (and APY for lenders). * All positions are **over‑collateralised** to protect lenders from default risk. [](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs/how-it-works#key-risks-per-user-type) Key Risks per User Type ---------------------------------------------------------------------------------------------------------------------------------------------- **Borrowers** * **Liquidation risk** — if the Health Factor of a loan falls below **1.0**, collateral is seized and sold. * **Rate volatility** — borrow APR can spike sharply during liquidity crunches; costs are unpredictable. **Lenders** * **Bad debt risk** — during market duress, liquidations may be unprofitable and cannot cover the borrower’s debt (e.g., oracle lag, deep slippage). Any residual shortfall is automatically socialised across all suppliers in that pool, reducing the value of each lender share. [](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs/how-it-works#variable-rate-mechanics) Variable‑Rate Mechanics ---------------------------------------------------------------------------------------------------------------------------------------------- Metric Formula Impact **Utilisation** `U = Total Borrows / Total Supply` Drives both borrow APR and lender APY. **Borrow APR** Piecewise linear curve (e.g., 7 % base → 25 % at 90 % U → 100 % at 99 % U) Spikes when liquidity is scarce. **Lender APY** `Borrow APR × U` minus a protocol spread Falls when utilisation drops or borrowers repay. [PreviousVanilla Markets](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs) [NextFAQ](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs/faq) Last updated 6 months ago --- # FAQ | Felix [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq#docs-internal-guid-85409cf3-7fff-2712-b20f-92b229718cbb-1) General ------------------------------------------------------------------------------------------------------------------------------------------------ ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq#what-is-bolds-peg-mechanism) What is feUSD’s peg mechanism? feUSD inherits Liquity V2’s market-driven design. Borrowers pick their own fixed interest rate; positions offering the **lowest** rate are redeemed first whenever feUSD < $1. * feUSD > $1 → borrowers lower rates (cheaper debt), making feUSD less attractive to hold and nudging price down. * feUSD < $1 → arbitrageurs redeem, burning supply; borrowers raise rates to avoid redemption, boosting feUSD demand and price. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq#docs-internal-guid-85409cf3-7fff-2712-b20f-92b229718cbb-1-1) Why use the CDP Market / feUSD? * **Capital efficiency** – higher LTV than vanilla lending because the Stability Pool backstops liquidations. * **Choose your cost of capital** – fixed, self-selected rate; no governance switches. * **Trust-minimised dollars** – peg holds without off-chain backing or oracles on the debt side. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq#docs-internal-guid-85409cf3-7fff-2712-b20f-92b229718cbb-1-2) What collateral can I use? HYPE and UBTC. LSTs and additional Unit assets coming soon. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq#is-there-a-minimum-debt) Is there a minimum debt? Yes, there is a minimum debt of 2,000 feUSD per position. This number will go lower in the coming weeks. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq#when-do-i-need-to-repay-my-debt) When do I need to repay my debt? There is **no set maturity**. Repay whenever you like, or let the position run indefinitely as long as your collateral ratio stays above the liquidation threshold. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq#how-do-i-decide-my-ltv) How do I decide my LTV? Choose a collateral ratio that matches your monitoring cadence: * **≥150 %** if you watch markets daily. * **≥180-200 %** for a more passive stance. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq#how-do-liquidations-work) How do liquidations work? If your account / position health falls below 1, the protocol burns feUSD from the Stability Pool to cancel your debt, then transfers your collateral (plus a 5 % penalty) to pool depositors. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq#how-are-liquidators-compensated) How are liquidators compensated? Liquidators get a small fee for calling liquidations. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq#what-is-a-zombie-position) What is a zombie position? A zombie position is any loan whose debt falls below the system’s minimum debt threshold, currently set at 2,000 feUSD. These positions cannot be adjusted — they can only be fully closed by repaying the remaining debt. The purpose of enforcing a minimum debt size is to ensure that redemptions remain economically viable. If positions become too small, the gas and operational costs of redeeming them could outweigh the benefits, weakening the system’s ability to maintain feUSD’s peg efficiently. [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq#docs-internal-guid-85409cf3-7fff-2712-b20f-92b229718cbb-1-3) Interest Rates --------------------------------------------------------------------------------------------------------------------------------------------------------- ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq#docs-internal-guid-85409cf3-7fff-2712-b20f-92b229718cbb-1-4) How do I decide on the right rate? Lower rate → cheaper debt **but** higher redemption probability; higher rate → costlier debt **but** safer from redemptions. * Active, short-term borrowers often sit **in the bottom quartile** of rates and monitor daily. * Passive, long-term borrowers generally choose a rate **at or above the median** to minimise maintenance. Keep a buffer of lower-rate borrowers ahead of you and watch feUSD <$ 1 activity to gauge redemption pressure. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq#can-i-adjust-my-interest-rate) Can I adjust my interest rate? Yes. Changing the rate within 7 days of the last adjustment (or position creation) incurs a _premature-adjustment fee_ equal to 7 days of average market interest, added to your debt. [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq#docs-internal-guid-85409cf3-7fff-2712-b20f-92b229718cbb-1-5) Redemptions ------------------------------------------------------------------------------------------------------------------------------------------------------ ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq#what-are-redemptions) What are redemptions? Redemptions are Felix’s on-chain “price floor” for feUSD. Whenever feUSD trades below $1, anyone can send feUSD to the protocol and receive exactly $1 of collateral (less a redemption fee). Because the redeemer immediately pockets the spread, the trade is only attractive when feUSD is under peg enough to cover the redemption fee; the buying pressure plus the burn of redeemed tokens lifts price back toward $1. * **What you swap:** 1 feUSD → $1 of whatever collateral mix currently backs the Stability Pool (e.g., HYPE, UBTC), proportional to pool weights. * **Who gets hit first:** the system cancels debt starting with the positions with the **lowest fixed interest rate**, so under-priced debt is removed before higher-rate, “safer” positions. * **What borrowers feel:** their debt shrinks by the redeemed amount; an equal USD value of collateral leaves their vault (minus the fee credit that stays behind). Net USD value stays flat or rises slightly thanks to the fee. * **Why it works:** supply contraction + higher average borrow rates incentivise Stability-Pool deposits and fresh borrowing, reinforcing the peg without any off-chain reserves or third-party market makers. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq#docs-internal-guid-85409cf3-7fff-2712-b20f-92b229718cbb) What happens if two Troves have the same IR? “Last-In, First-Out” applies: the position that most recently set that rate is redeemed first. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq#when-can-redemptions-occur) When can redemptions occur? A redemption can occur at any time, but will likely only happen when it is profitable to do so. This is usually the case when the price of feUSD is less than $1 (minus the current redemption fee). ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq#is-there-a-redemption-fee) Is there a redemption fee? Yes, there is a redemption fee. The redemption fee percentage is given by `min (0.5% + baseRate, 100%)`. Redemption fees are based on the `baseRate` state variable, which is dynamically updated. The `baseRate` increases with each redemption, and exponentially decays according to time passed since the last redemption (half-life of 6 hours). Upon each redemption of x feUSD: `baseRate` is decayed based on time passed since the last fee event and incremented by an amount proportional to the fraction of the total feUSD supply to be redeemed, i.e. `x/total_feUSD_supply` ![](https://usefelix.gitbook.io/docs/~gitbook/image?url=https%3A%2F%2F2357968670-files.gitbook.io%2F%7E%2Ffiles%2Fv0%2Fb%2Fgitbook-x-prod.appspot.com%2Fo%2Fspaces%252FVH6och7EAxl0pIZxgbqv%252Fuploads%252FfJt8v6f4a6FbmF2lpIil%252Fimage.png%3Falt%3Dmedia%26token%3D32ee30bf-7f27-449c-954c-ac452d83efed&width=768&dpr=4&quality=100&sign=2172e628&sv=2) The redemption fee (red line) follows this dynamic over time as redemptions occur (blue bars). ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq#docs-internal-guid-6cda6d73-7fff-78b8-1c4f-6cb96385a98a) How do redemptions work with multiple collateral assets? The protocol supplies the redeemer with **a mix** of collateral that mirrors the Stability-Pool backing. This improves overall backing. Backing is quantified as the debt: stability pool ratio per collateral. [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq#docs-internal-guid-85409cf3-7fff-2712-b20f-92b229718cbb-1-6) Stability Pools ---------------------------------------------------------------------------------------------------------------------------------------------------------- ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq#where-does-the-yield-for-earn-come-from) Where does the yield for Earn come from? 1. **Borrower interest:** Borrower interest flows to its Stability Pool as well as upfront fees. 2. **Liquidation gains:** feUSD is burned to cancel bad debt; depositors receive collateral at ~5 % discount. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq#what-mechanisms-are-in-place-if-the-stability-pool-is-empty) What mechanisms are in place if the Stability Pool is empty? Liquidators can choose: * **Just-in-Time (JIT):** bring feUSD to cover remaining debt and receive 105 % of that value in collateral. * **Redistribution:** the liquidator triggers a redistribution, through which the position's entire debt and collateral is redistributed to all fellow borrowers of the respective collateral market, in proportion to their own collateral amounts. Thus, the respective borrowers will receive a share of the liquidated collateral and see their debts increase proportionally. [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq#miscellaneous) Miscellaneous ---------------------------------------------------------------------------------------------------------- ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq#is-there-a-redemption-fee-1) How do I transfer feUSD to HyperCore? Send your feUSD to the following address: 0x20000000000000000000000000000000000000f1. Please test with a small amount first. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq#is-there-a-redemption-fee-2) What is the feUSD token address? 0x02c6a2fa58cc01a18b8d9e00ea48d65e4df26c70 ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq#is-there-a-redemption-fee-3) What are general risks to the protocol? **1\. Collateral Asset Failure** Collateral asset failure occurs when the value of a collateral asset falls drastically and irreparably. Felix combats this risk by over-collateralizing feUSD with three of crypto's most trusted collateral assets (BTC, ETH, SOL), but the introduction of newer assets like HYPE and PURR will require close monitoring in the early days of the protocol. **2\. Bridge Receipt Failure** While Felix supports trusted majors as collateral assets, the aforementioned assets aside from HYPE and PURR are not native to Hyperliquid. In the event of a bridge receipt failure, the bridged versions of these otherwise-trusted assets could abruptly be worth $0. **3\. Liquidation Cascade Risk** Related to collateral failure risk, but slightly different, is liquidation cascade risk. This is the risk caused by self-reinforcing drawdowns in collateral value as liquidations further pile on to adverse price action. It is unlikely that Felix liquidations will materially impact the valuations of BTC, ETH, and SOL, but it remains a relevant concern for assets like HYPE or PURR. This risk is addressed mainly by the presence of Stability Pool liquidity as well as collateral-specific minting caps. **4\. Smart Contract Risk** Felix is based off of the Liquity V2 codebase which has undergone substantial auditing as well as formal verification. Still, the protocol has yet to see material time in the wild and cannot be considered battle tested just yet. Along with these audits on the current codebase, any codebase change is audited before implementation, and Felix has plans to become an immutable protocol in the future. [PreviousEarning feUSD yield](https://usefelix.gitbook.io/docs/money-market-products/quickstart/earning-feusd-yield) [NextVanilla Markets](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs) Last updated 6 months ago --- # Privacy Policy | Felix **Privacy Policy for Felix** Last Updated: 30 October 2024 1. Introduction 1.1. This Privacy Policy details how Felix (“we,” “us,” “our,” or the “Platform”) collects, processes, shares, and safeguards information about users (“Users” or “You”) interacting with or using our Platform. We respect your privacy and are dedicated to protecting your Personal Data and Blockchain Data in accordance with applicable data protection laws. 1.2. Definitions: Unless expressly defined herein, all capitalised terms in this Privacy Policy are as defined in the Platform’s General Terms and Conditions (“T&Cs”). By accessing or using the Platform, you confirm your understanding of and consent to, the data practices outlined in this Privacy Policy. If you disagree with this Policy, please discontinue use of the Platform. 1. Definitions 2.1. For clarity, the following terms are defined as follows: 2.1.1. Platform: Felix’s digital ecosystem, including its user interface and smart contract infrastructure, facilitates decentralised finance (DeFi) transactions, including borrowing, collateral management, and token redemptions. 2.1.2. Personal Data: Information that can identify an individual, either alone or combined with other data, as defined by relevant data protection laws. 2.1.3. Blockchain Data: Information related to blockchain transactions, including wallet addresses, transaction IDs, and timestamps, is recorded on the blockchain. 2.1.4. Third-Party Wallet Providers: Independent wallet services (such as MetaMask) that allow Users to interact with blockchain-based services on the Platform. 2.2. These definitions are aligned with the T&Cs, ensuring that terms are consistent across all documents governing your use of the Platform. 1. Information We Collect Felix collects several types of information necessary to provide our services, enhance the user experience, comply with legal obligations, and ensure the security of the Platform. 3.1. Information Provided by Users 3.1.1. Blockchain Wallet Information: To use the Platform, Users must connect a compatible blockchain wallet. We do not store private keys or access wallet contents; however, wallet addresses and transaction data may be recorded to execute transactions and facilitate Platform interactions. 3.1.2. User Preferences and Settings: Some Platform features allow Users to set preferences, such as notifications for collateral thresholds or redemption alerts. This information is stored in association with the User’s wallet address. 3.1.3. User Communications: When you contact our support team, we collect the communication details, including your email address, name, and message content. This information helps us respond to inquiries and improve our customer service. 3.2. Automatically Collected Information 3.2.1. Blockchain Data: Due to the transparency of blockchain networks, all transactions (e.g., borrowing, redemptions) conducted on the Platform are visible on the public blockchain. This includes wallet addresses, transaction timestamps, and transaction-specific details, which are immutable and beyond the Platform’s control. 3.2.2. Usage Data: We collect technical data automatically when you access the Platform, including browser types, device types, operating systems, IP addresses, page views, and timestamps. This information is de-identified where feasible and used to monitor and improve Platform performance. 3.2.3. Cookies and Similar Technologies: We may use cookies or similar technologies to enhance Platform navigation, remember User preferences, and analyze trends. You may adjust browser settings to control cookie preferences, though this may affect the usability of certain Platform features. 3.3. Information from Third-Party Sources 3.3.1. Third-Party Wallet Providers: When you connect a third-party wallet to the Platform, limited data is shared with us (e.g., your wallet address) to facilitate access. We advise reviewing the privacy practices of any third-party wallet provider, as we are not responsible for the data handling practices of these providers. 1. How We Use Your Information The Platform uses collected data for various essential purposes, as outlined below: 4.1. Service Provision and Platform Management 4.1.1. Facilitating Transactions: Wallet and transaction data are processed to execute and verify transactions on the Platform, such as collateral deposits, redemptions, and loan repayments. 4.1.2. User Experience Optimization: Usage data is analysed to improve Platform performance, tailor user interfaces, and introduce new features based on user demand and technical insights. 4.1.3. Maintaining Security: We process data to detect and mitigate security risks, unauthorised access attempts, and other malicious activity. This includes monitoring for suspicious activity to protect User assets and Platform integrity. 4.1.4. Customer Support and Communication: Communication data enables us to address inquiries, provide support, resolve technical issues, and enhance the overall User experience. 4.2. Legal and Regulatory Compliance 4.2.1. Anti-Money Laundering (AML) and Counter-Terrorism Financing (CTF): Certain data may be processed in line with regulatory requirements to monitor for suspicious activity and report where legally required. 4.2.2. Compliance and Risk Management: We process data to manage financial, operational, and legal risks, ensuring the Platform remains compliant with applicable laws and minimising exposure to liabilities or reputational harm. 4.3. Research and Analytics 4.3.1. Aggregated Analytics: Anonymized data is aggregated for research and trend analysis to improve Platform efficiency and identify new user needs. Aggregated data cannot be used to identify individual Users. 1. Information Disclosure Felix shares User data with third parties only in limited, controlled situations to protect User privacy and ensure compliance with legal obligations. 5.1. Public Disclosure of Blockchain Data 5.1.1. Blockchain Transparency: Transactions on the Platform are inherently public and recorded on blockchain networks. This transparency is fundamental to decentralised finance, and as such, wallet addresses and transaction metadata are viewable by any network participant. Felix does not control or modify this public record. 5.2. Disclosures to Service Providers and Legal Entities 5.2.1. Service Providers: We may share limited data with third-party vendors, including analytics providers and security experts, to help maintain, analyse, and optimise Platform performance. 5.2.2. Legal and Regulatory Disclosure: We may disclose Personal Data to comply with legal processes, court orders, or regulatory obligations. This includes responding to lawful requests by law enforcement authorities where there is a valid legal basis. 5.3. Business Transactions 5.3.1. Corporate Changes: In the event of a merger, acquisition, or sale of Felix, User data may be transferred to the acquiring entity as part of the transaction. In such cases, we will provide notice of any new or revised Privacy Policy applicable to Users. 1. Data Retention Data collected on the Platform is retained only as long as necessary to fulfil the purposes outlined in this Privacy Policy or as required by law. Blockchain Data remains permanently recorded on the blockchain network, as is inherent to blockchain technology. Customer Support Data and other communication records are retained for reference, dispute resolution, and quality control for a period as specified by applicable laws, after which they may be anonymised or deleted. 1. Security Measures 7.1. We implement technical and organisational security measures to protect User data from unauthorised access, disclosure, alteration, or destruction. Measures include: 7.1.1. Encryption: Sensitive data is encrypted during transmission and storage where applicable. 7.1.2. Access Controls: Only authorised personnel have access to User data, and access is granted strictly on a need-to-know basis. 7.1.3. Regular Audits: We conduct security audits and vulnerability assessments to identify and address potential threats to data integrity. 7.1.4. User Responsibility: Users are advised to protect their private keys and wallet credentials diligently, as these are essential for accessing and securing their blockchain assets. 7.2. While we take comprehensive steps to secure data, Users should note that blockchain technology involves unique security risks, and no method of electronic storage is entirely secure. 1. International Data Transfers Given the global nature of blockchain technology, User data may be processed on servers in jurisdictions outside the User’s home country. These jurisdictions may not have equivalent data protection laws, but we will take steps to ensure that any transfer of Personal Data is protected in line with applicable privacy standards. By using the Platform, you agree to such international data transfers. 1. User Rights and Choices 9.1. Depending on applicable laws, you may have the following rights concerning your Personal Data: 9.1.1. Right of Access: You may request access to your Personal Data and ask us to confirm whether we are processing it, along with information about the purposes of processing and any third-party data recipients. 9.1.2. Right to Correction: You can request that we correct or update any inaccurate or incomplete Personal Data. 9.1.3. Right to Deletion: Where feasible, you may request the deletion of your Personal Data. Note that data stored on the blockchain cannot be altered or deleted by the Platform. 9.1.4. Data Portability: You may request a copy of your Personal Data in a machine-readable format to transfer it to another service. 1. Children’s Privacy The Platform is not intended for individuals under the age of 18, and we do not knowingly collect Personal Data from minors. 1. Changes to This Privacy Policy We may update this Privacy Policy periodically to reflect changes in our practices, legal obligations, or technology. When updates are made, we will revise the “Last Updated” date at the top of this page. [PreviousTerms & Conditions](https://usefelix.gitbook.io/docs/terms/terms-and-conditions) [NextCookie Policy](https://usefelix.gitbook.io/docs/terms/cookie-policy) Last updated 12 months ago --- # Vanilla Markets | Felix [](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs#overview) Overview --------------------------------------------------------------------------------------------------- Vanilla Markets sit alongside the feUSD CDP market and will be rolled out in May 2025. It is built on **Morpho’s lending stack** and pair borrows and lenders. Side Role What they supply What they earn / pay **Borrowers** Deposit collateral to borrow an asset (e.g., HUSD, HYPE, USDC). Debt accrues at a **dynamic variable rate**. Collateral (HYPE, UBTC, ETH …) Pay a floating borrow APY determined by utilisation. **Lenders** Supply idle assets (HYPE, USDC,‑etc.) to earn yield. Funds are matched P2P first; excess sits in the underlying pool. Assets they wish to earn on Earn the borrow APY minus a small protocol spread. Unlike the CDP, **there are no redemptions or borrower‑set fixed rates**—all pricing follows a utilisation curve. ### [](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs#why-use-vanilla-markets) Why Use Vanilla Markets? 1. **Asset‑native borrowing** — obtain HYPE, USDC, or other supported tokens directly, avoiding the need to mint feUSD and swap. 2. **No redemption risk** — positions are immune to the feUSD peg mechanics. #### [](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs#trade-offs-vs.-the-feusd-cdp) Trade‑offs vs. the feUSD CDP * **Higher effective borrow cost** on average (floating APR vs. self‑selected fixed rate). * **Lower LTV** (75–80 % typical) because the Stability Pool backstop is absent. * **Interest‑rate volatility** — costs can spike in a liquidity crunch. ### [](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs#accepted-collateral) Accepted Collateral Coming soon. [PreviousFAQ](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq) [NextHow it Works](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs/how-it-works) Last updated 6 months ago --- # Cookie Policy | Felix **Cookie Policy for Felix** Last Updated: 30 October 2024 1. Introduction 1.1. This Cookie Policy explains how Felix (“we,” “us,” “our,” or the “Platform”) uses cookies and similar technologies to collect and store information when Users (“Users” or “You”) access our Platform. By using our Platform, you agree to the use of cookies as described in this policy. 1.2. This Cookie Policy forms part of our overall Privacy Policy. Any terms defined in the Privacy Policy or the General Terms and Conditions apply to this Cookie Policy unless explicitly stated otherwise. 1. What Are Cookies? 2.1. Cookies are small data files placed on your device (e.g., computer, smartphone, or tablet) by websites you visit. Cookies are widely used to make websites work more efficiently, as well as to provide information to the website owners. They help recognize you on future visits, remember your preferences, and improve your user experience. 2.2. Cookies can be either session cookies (which are deleted when you close your browser) or persistent cookies (which remain on your device until they expire or are deleted manually). 1. Types of Cookies We Use Felix uses the following types of cookies on its Platform: 3.1. Essential Cookies These cookies are necessary for the Platform to function correctly and to provide core services. Without these cookies, certain features of the Platform, such as secure login and transaction processing, may not operate properly. 3.1.1. Purpose: Ensures the stability, security, and accessibility of the Platform. 3.1.2. Examples: Session management cookies, and authentication cookies. 3.2. Functional Cookies Functional cookies enable us to remember the choices you make and provide enhanced, personalized features. For example, these cookies allow us to remember your preferred settings and other customizations. 3.2.1. Purpose: Improve user experience by remembering your preferences and settings. 3.2.2. Examples: Language preference cookies, and notification preferences. 3.3. Performance and Analytics Cookies These cookies help us understand how Users interact with the Platform by collecting and reporting information on Platform usage. The information gathered is anonymous and is used solely for internal analysis to improve our services. 3.3.1. Purpose: Collect data on user behavior, page views, and other usage statistics to optimise Platform functionality. 3.3.2. Examples: Google Analytics cookies (if applicable). 3.4. Targeting and Advertising Cookies Targeting cookies may be set through our Platform by third-party services to display relevant advertisements based on your browsing habits and interests. We use these cookies only if you have provided explicit consent. 3.4.1. Purpose: Deliver relevant advertising and measure its effectiveness. 3.4.2. Examples: Cookies from advertising networks that track interactions on the Platform. 1. Third-Party Cookies 4.1. Some cookies on our Platform are placed by third parties, such as analytics providers or advertisers. These third parties may collect information about your device, browser, and usage activity. We do not control these cookies, and you should review the privacy policies of the respective third-party providers for more information on how they use and manage cookies. 4.2. Examples of third-party services used on our Platform may include: 4.2.1. Analytics services (e.g., Google Analytics) to measure Platform usage. 4.2.2. Advertising networks that help serve targeted ads and promotions. 1. How We Use Cookies 5.1. We use cookies for several purposes, including to: 5.1.1. Provide Platform Functionality: Essential and functional cookies ensure our Platform operates smoothly and offers the features Users expect. 5.1.2. Enhance User Experience: Cookies enable personalised features, such as remembering User settings and preferences. 5.1.3. Analyse Platform Performance: Performance and analytics cookies help us understand how Users engage with the Platform, allowing us to improve user experience and optimise Platform performance. 5.1.4. Deliver Relevant Content: Targeting cookies allows us to provide Users with tailored advertising and promotions, based on their preferences and browsing activity. 1. Managing Your Cookie Preferences 6.1. You can manage your cookie preferences at any time by adjusting your browser settings to delete or block certain cookies. Most browsers allow you to view, manage, delete, and block cookies for a website. Please be aware that if you disable cookies, certain features of the Platform may not function as intended. 6.2. To manage cookies, refer to your browser’s help or support section, or follow the steps below for common browsers: 6.2.1. Google Chrome: Chrome Cookie Settings 6.2.2. Mozilla Firefox: Firefox Cookie Settings 6.2.3. Safari: Safari Cookie Settings 6.2.4. Microsoft Edge: Edge Cookie Settings 6.3. Alternatively, you can use third-party services, such as Your Online Choices, to opt out of certain advertising cookies. 1. Consent to Use Cookies Upon your first visit to the Platform, we will request your consent for the use of cookies through a cookie banner. By continuing to use the Platform after consenting, you confirm your acceptance of our use of cookies as outlined in this Cookie Policy. 1. Changes to This Cookie Policy We may update this Cookie Policy periodically to reflect changes in our use of cookies or to comply with legal and regulatory requirements. Any updates will be posted on this page with the “Last Updated” date changed accordingly. Continued use of the Platform after such changes indicates acceptance of the updated Cookie Policy. 1. Contact us If you have any questions, concerns, or require further information, please do not hesitate to contact us: **Email:** legal@usefelix.xyz [PreviousPrivacy Policy](https://usefelix.gitbook.io/docs/terms/privacy-policy) Last updated 9 months ago --- # Smart Contract Audits | Felix [](https://usefelix.gitbook.io/docs/advanced/smart-contract-audits#liquity-v2-audits) Liquity V2 Audits ------------------------------------------------------------------------------------------------------------ The Liquity V2 codebase, which serves as the foundation of the Felix protocol CDP system, has been through several audit rounds by different auditing companies, such as audited by Dedaub, ChainSecurity, Recon, Coinspect and Three Sigma; furthermore, the codebase has been formally verified by Certora. #### [](https://usefelix.gitbook.io/docs/advanced/smart-contract-audits#audit-reports) Audit reports [ChainSecurity - Core Protocol Audit Report](https://www.chainsecurity.com/security-audit/liquity-bold-smart-contracts) , December 2024 [Dedaub - Core Protocol Audit Report I](https://dedaub.com/audits/liquity/liquity-v2-aug-28-2024/) , August 2024 [Dedaub - Core Protocol Audit Report II](https://dedaub.com/audits/liquity/liquity-v2-second-audit-nov-11-2024/) , November 2024 [Certora - Formal Verification](https://certora.cdn.prismic.io/certora/Z1tLJJbqstJ98b8J_LiquityVerificationReport.pdf) , December 2024 [Coinspect - Bold Core Smart Contract Audit](https://www.coinspect.com/doc/Coinspect%20-%20Smart%20Contract%20Audit%20-%20Liquity%20-%20Bold%20-%20v241231.pdf) , December 2024 [Coinspect - Bold Governance Audit](https://www.coinspect.com/doc/Coinspect%20-%20Smart%20Contract%20Audit%20-%20Liquity%20-%20Bold%20Governance%20-%20v250120.pdf) , January 2025 [ChainSecurity -Governance Smart Contract Audit](https://www.chainsecurity.com/security-audit/liquity-v2-governance) , January 2025 [Dedaub - Governance Audit 1](https://dedaub.com/audits/liquity/liquity-v2-governance-1st-audit-aug-12-2024/) , August 2024 [Dedaub - Governance Audit 2](https://dedaub.com/audits/liquity/liquity-v2-governance-2nd-audit-nov-11-2024/) , November 2024 [Dedaub - Governance Audit 3](https://dedaub.com/audits/liquity/liquity-v2-governance-3rd-audit-dec-22-2024/) , January 2025 [Recon - Liquity Security Review](https://github.com/GalloDaSballo/bold-review) , October 2024 [](https://usefelix.gitbook.io/docs/advanced/smart-contract-audits#felix-audits) Felix Audits -------------------------------------------------------------------------------------------------- The Felix codebase has primarily changed 3 components to the Liquity V2 codebase: * **Added mint caps:** Used to control leverage in the system * **Enabled trove parameter adjustments by admin:** Used primarily to adjust mint caps * **Enabled protocol pausing by admin:** Used to pause the system in the scenario of long-tail risk scenarios These changes are actively being audited by Dedaub and Coinspect. These two audits are listed below. 1MB [Felix Audit by Dedaub.pdf](https://2357968670-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FVH6och7EAxl0pIZxgbqv%2Fuploads%2FckGCSwgMVirpVuz2oDep%2FFelix%20Audit%20by%20Dedaub.pdf?alt=media&token=b234b781-d9bc-4956-bb47-0d8d80e62256) PDF Download[Open](https://2357968670-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FVH6och7EAxl0pIZxgbqv%2Fuploads%2FckGCSwgMVirpVuz2oDep%2FFelix%20Audit%20by%20Dedaub.pdf?alt=media&token=b234b781-d9bc-4956-bb47-0d8d80e62256) All Felix protocol smart contracts will retain upgradability upon deployment. Any future changes prior to the removal of admin privileges will undergo further auditing. [PreviousFAQ](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs/faq) [NextRisk Management](https://usefelix.gitbook.io/docs/advanced/risk-management) Last updated 7 months ago --- # Market 1: feUSD CDP | Felix [](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp#overview) Overview ----------------------------------------------------------------------------------------- The feUSD CDP is a a decentralized borrowing and stablecoin Market that builds on Liquity V2. * **Borrowers** deposit HYPE or other assets as collateral and borrow feUSD with user-set interest rates. * **Stability Pool Depositers** deposit feUSD to earn borrower interest & liquidation rewards. #### [](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp#protocol-parameters) Protocol Parameters These parameters are common to all the collateral branches in the protocol. Each branch is independent to each other and they don't share any state. Parameter Value feUSD 0x02c6a2fa58cc01a18b8d9e00ea48d65e4df26c70 Collateral Registry 0x9de1e57049c475736289cb006212f3e1dce4711b Hint Helpers 0xa32e89c658f7fdcc0bdb2717f253bacd99f864d4 WHYPE 0x5555555555555555555555555555555555555555 #### [](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp#whype-parameters) WHYPE Parameters Parameter Value WHYPE Zapper (For Native Hype) 0xd389c600B302C05e619a25112B27eA07C62A6c8c Active Pool 0x39ebba742b6917d49d4a9ac7cf5c70f84d34cc9e Address Registry 0x7201fb5c3ba06f10a858819f62221ae2f473815d Borrower Operations 0x5b271dc20ba7beb8eee276eb4f1644b6a217f0a3 Collateral Surplus Pool 0x9182e36bd7cceb71812c766c4464208ad9c122ca Default Pool 0xa1e95e74d07fec324a82cd2ef19ebcb33907c605 Gas Pool 0x7560059081ede2ff6c6b980fd1ee9a53df4e9935 Price Feed 0x12a1868b89789900e413a6241ca9032dd1873a51 Sorted Troves 0xd1caa4218808eb94d36e1df7247f7406f43f2ef6 Stability Pool 0x576c9c501473e01ae23748de28415a74425efd6b Trove Manager 0x3100f4e7bda2ed2452d9a57eb30260ab071bbe62 Trove NFT 0x5ad1512e7006fdbd0f3ebb8aa35c5e9234a03aa7 #### [](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp#ubtc-parameters) UBTC Parameters Parameter Value UBTC 0x9fdbda0a5e284c32744d2f17ee5c74b284993463 feUBTC (Felix UBTC Wrapper for Decimals) 0xefbd9cfe88235f0e648aefb52c8e8dc152a9ad6f Active Pool 0x8d99575ebbbda038a626ca769561c16fdd7a5939 Address Registry 0xfc4e20bd9f0e4f8782bea92a7bd8002367882407 Borrower Operations 0x36b7bd65276eda7cdc5f730da5cdb7ee7736672e Collateral Surplus Pool 0xe7aba857f8e2c95462e69b93c7ea78ac19aafe38 Default Pool 0x50743a84c68a9d14d93364ed31afa4012183df1c Gas Pool 0x8b71c92edf02dff693042e4e808d0568ccf0a137 Price Feed 0xf59f338424062dd1d44a9b4dd2721128a45358ab Sorted Troves 0x642d979341eaac9c10623f5a58283aa72f6e2fa9 Stability Pool 0xabf0369530205ae56dd4c49629474c65d1168924 Trove Manager 0xbbe5f227275f24b64bd290a91f55723a00214885 Trove NFT 0xad8a43ac8da98990efa4d5ec7b91135965d5846b #### [](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp#khype-parameters) kHYPE Parameters Parameter Value kHYPE 0xfd739d4e423301ce9385c1fb8850539d657c296d Active Pool 0xbfd0b103a49faf426f36864d19f5d871bf411a5a Address Registry 0x382d2fe4eed8e35a5855321e62fd45ad60ca589f Borrower Operations 0x3a2a181ab6e4ffb77c87ee201041a0806dadc397 Collateral Surplus Pool 0x246aceb6b121fe2cb7ec76fcf8e667fb8096f7b0 Default Pool 0xee6d1804feb4817d6db77f6f31b86673d7fc195f Gas Pool 0xea5d5a859be7c96aa0481ed35170af8e277a9f8e Price Feed 0x0a04e685f12e47b22b03c3763add63f1dd73265c Sorted Troves 0x6bc81472c10ec526c14c8b0e8faa282f9368f86f Stability Pool 0x56a346e0730cb209a93964c41cd36098030779ab Trove Manager 0x7c07bb77b1cf9a5b40d92f805c10d90c90957e4a Trove NFT 0x9d08780deec2270b8296f520b3fb28346abf6036 #### [](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp#wsthype-parameters-coming-soon) wstHYPE Parameters (coming soon) Parameter Value wstHYPE 0x94e8396e0869c9f2200760af0621afd240e1cf38 Active Pool 0x7abca40474d6b5f000f801d7fe7e0df4c89425ff Address Registry 0x6a1ce00901c3deb2683a6c63fcd158cc3adc2740 Borrower Operations 0x389c03c1f77981d158fbe286e7cafac2bb2fe83e Collateral Surplus Pool 0x339d10ba20f3575ec9b44275f978dd38386f0f32 Default Pool 0x535a9ff6bfd0d9f1b64fe03f185b0af8ddeb7bd1 Gas Pool 0x5db69b925c35b85905255f0b9443bfefda97fce0 Price Feed 0x067e69ad6bdb8ee95cac31b34626f48eb6f169a2 Sorted Troves 0xa82c325553baee63bd97604e10a7cc40482008a1 Stability Pool 0xadfba621a75beced7dd1727b2067047b7eeedc8b Trove Manager 0x58446c58caa8a6f6cc8be343f812ebf0b997c001 Trove NFT 0x7d29515fc4eaef2a01c46218b4cb8d2d8ae437e4 [](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp#read-functions) Read Functions ----------------------------------------------------------------------------------------------------- ### [](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp#total-collateral-balance) Total Collateral Balance * **Contract**: Active Pool Contract * **Purpose**: Returns the total collateral balance currently held in the Active Pool for a given collateral branch. * **Parameters**: None * **Return Values**: * `collBalance`: A `uint256` representing the total amount of collateral stored in the Active Pool. Copy getCollBalance() external view returns (uint256 collBalance) ### [](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp#total-feusd-debt) Total feUSD Debt * **Contract**: Active Pool Contract * **Purpose**: Returns the total outstanding debt in the Active Pool contract for a given collateral branch, including recorded debt, pending interest, and batch management fees. * **Parameters**: None * **Return Values**: * `totalDebt`: A `uint256` representing the sum of: * `aggRecordedDebt`: The total recorded debt in the system. * `calcPendingAggInterest()`: The calculated pending interest on the aggregate debt. * `aggBatchManagementFees`: The total accumulated batch management fees. * `calcPendingAggBatchManagementFee()`: The calculated pending batch management fees. Copy getfeUSDDebt() external view returns (uint256 totalDebt) ### [](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp#latest-trove-data) Latest Trove Data * **Contract**: Trove Manager Contract * **Purpose**: Returns the most recent state of a specified Trove, including collateral, debt, and other relevant data. * **Parameters**: * `_troveId`: The unique identifier of the Trove to be fetched. * **Return Values**: * `trove`: A `LatestTroveData` struct containing the most recent state of the specified Trove, including: * `entireColl`: Total collateral held by the Trove. * `entireDebt`: Total debt of the Trove, including interest and fees. * `redistCollGain`: Collateral gains from redistribution. * `redistFelixDebtGain`: Debt gains from redistribution. * `annualInterestRate`: The annual interest rate currently applied to the Trove's debt. * `lastInterestRateAdjTime`: Timestamp of the last interest rate adjustment. Copy getLatestTroveData(uint256 _troveId) external view returns (LatestTroveData memory trove) ### [](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp#total-stability-pool-feusd-deposits) Total Stability Pool feUSD Deposits * **Contract:** Stability Pool Contract * **Purpose**: Returns the total amount of feUSD deposits currently held in the Stability Pool. * **Parameters**: None * **Return Values**: * `totalDeposits`: A `uint256` representing the cumulative sum of all feUSD deposits in the Stability Pool. Copy getTotalFelixDeposits() external view returns (uint256 totalDeposits) ### [](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp#depositor-yield-gain-with-pending) Depositor Yield Gain with Pending * **Contract**: Stability Pool Contract * **Purpose**: Returns the total yield gain for a specific depositor, including both realized and pending yield from the Stability Pool. * **Parameters**: * `_depositor`: The address of the user whose yield gain is being queried. * **Return Values**: * `yieldGain`: A `uint256` representing the total yield gain of the depositor, including pending yield gains from the current epoch and scale. Copy getDepositorYieldGainWithPending(address _depositor) external view returns (uint256 yieldGain) ### [](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp#compounded-feusd-deposit) Compounded feUSD Deposit * **Contract**: Stability Pool Contract * **Purpose**: Returns the compounded value of a user's feUSD deposit in the Stability Pool, accounting for yield gains since the last update. * **Parameters**: * `_depositor`: The address of the user whose compounded deposit is being queried. * **Return Values**: * `compoundedDeposit`: A `uint256` representing the current value of the user's feUSD deposit after compounding yield gains and losses. Copy getCompoundedFelixDeposit(address _depositor) public view returns (uint256 compoundedDeposit) [](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp#write-functions) Write Functions ------------------------------------------------------------------------------------------------------- ### [](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp#open-trove) Open Trove * **Contract**: Trove Manager Contract * **Purpose**: Opens a new Trove with the specified collateral and debt amount, setting the owner's position and initializing the interest rate and fee parameters. * **Parameters**: * `_owner`: The address of the user opening the Trove. * `_ownerIndex`: Index to track the owner's position in the Trove list. * `_collAmount`: The amount of collateral (in the native token) to be deposited. * `_felixAmount`: The amount of feUSD stablecoin to be borrowed against the collateral. * `_upperHint`: ID of the Trove above the new Trove in the sorted list (for gas optimization). * `_lowerHint`: ID of the Trove below the new Trove in the sorted list (for gas optimization). * `_annualInterestRate`: The annual interest rate applied to the borrowed amount. * `_maxUpfrontFee`: The maximum allowable upfront fee for borrowing. * `_addManager`: Address authorized to add collateral to the Trove. * `_removeManager`: Address authorized to remove collateral from the Trove. * `_receiver`: Address receiving the borrowed feUSD stablecoin. * **Return Values**: * `troveId`: A `uint256` representing the unique identifier of the newly opened Trove. Copy openTrove( address _owner, uint256 _ownerIndex, uint256 _collAmount, uint256 _felixAmount, uint256 _upperHint, uint256 _lowerHint, uint256 _annualInterestRate, uint256 _maxUpfrontFee, address _addManager, address _removeManager, address _receiver ) external returns (uint256 troveId) ### [](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp#add-collateral-to-trove) Add Collateral to Trove * **Contract**: Trove Manager Contract * **Purpose**: Increases the collateral balance of an existing Trove, enhancing its collateralization ratio and reducing liquidation risk. * **Parameters**: * `_troveId`: The unique identifier of the Trove to which collateral is being added. * `_collAmount`: The amount of collateral (in the native token) to be added to the Trove. * **Return Values**: None Copy addColl(uint256 _troveId, uint256 _collAmount) external ### [](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp#withdraw-collateral-from-trove) Withdraw Collateral from Trove * **Contract**: Trove Manager Contract * **Purpose**: Decreases the collateral balance of an existing Trove, allowing the owner to withdraw collateral while maintaining the required collateralization ratio. * **Parameters**: * `_troveId`: The unique identifier of the Trove from which collateral is being withdrawn. * `_collWithdrawal`: The amount of collateral to be withdrawn from the Trove. * **Return Values**: None Copy withdrawColl(uint256 _troveId, uint256 _collWithdrawal) external ### [](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp#borrow-more-feusd-from-trove) Borrow more feUSD from Trove * **Contract**: Trove Manager Contract * **Purpose**: Increases the debt of an existing Trove, allowing the owner to withdraw additional feUSD stablecoin against the collateral while maintaining the required collateralization ratio. * **Parameters**: * `_troveId`: The unique identifier of the Trove from which feUSD is being withdrawn. * `_felixAmount`: The amount of feUSD stablecoin to be withdrawn from the Trove. * `_maxUpfrontFee`: The maximum allowable upfront fee for the debt increase. * **Return Values**: None Copy withdrawFelix(uint256 _troveId, uint256 _felixAmount, uint256 _maxUpfrontFee) external ### [](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp#repay-feusd-debt-in-trove) Repay feUSD Debt in Trove * **Contract**: Trove Manager Contract * **Purpose**: Decreases the debt of an existing Trove, allowing the owner to repay feUSD stablecoin and reduce the outstanding debt while increasing the collateralization ratio. * **Parameters**: * `_troveId`: The unique identifier of the Trove whose debt is being repaid. * `_felixAmount`: The amount of feUSD stablecoin to be repaid towards the Trove's debt. * **Return Values**: None Copy repayFelix(uint256 _troveId, uint256 _felixAmount) external ### [](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp#adjust-trove-interest-rate) Adjust Trove Interest Rate * **Contract**: Trove Manager Contract * **Purpose**: Adjusts the annual interest rate of an existing Trove, recalculating the debt and updating the Trove's position in the sorted list accordingly. An upfront fee applies. * **Parameters**: * `_troveId`: The unique identifier of the Trove whose interest rate is being adjusted. * `_newAnnualInterestRate`: The new annual interest rate to be applied to the Trove's debt. * `_upperHint`: Address of the Trove above the adjusted Trove in the sorted list (for gas optimization). * `_lowerHint`: Address of the Trove below the adjusted Trove in the sorted list (for gas optimization). * `_maxUpfrontFee`: The maximum allowable upfront fee for making the interest rate adjustment. * **Return Values**: None Copy adjustTroveInterestRate( uint256 _troveId, uint256 _newAnnualInterestRate, uint256 _upperHint, uint256 _lowerHint, uint256 _maxUpfrontFee ) external ### [](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp#close-trove) Close Trove * **Contract**: Trove Manager Contract * **Purpose**: Closes an existing Trove by repaying the entire debt, including accrued interest, batch fees, and redistribution gains. It returns the collateral to the owner and updates the protocol's state accordingly. * **Parameters**: * `_troveId`: The unique identifier of the Trove to be closed. * **Return Values**: None Copy closeTrove(uint256 _troveId) external ### [](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp#provide-to-stability-pool) Provide to Stability Pool * **Contract**: Stability Pool Contract * **Purpose**: Deposits feUSD stablecoin into the Stability Pool, earning yield and collateral gains from liquidations. Optionally allows the user to claim accumulated yield during the deposit operation. * **Parameters**: * `_topUp`: The amount of feUSD stablecoin to be added to the user's Stability Pool deposit. * `_doClaim`: A boolean indicating whether to claim accumulated yield gains during this operation. * **Return Values**: None Copy provideToSP(uint256 _topUp, bool _doClaim) external ### [](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp#withdraw-from-stability-pool) Withdraw from Stability Pool * **Contract**: Stability Pool Contract * **Purpose**: Withdraws feUSD stablecoin from the user's deposit in the Stability Pool. Optionally allows the user to claim accumulated yield and collateral gains during the withdrawal. * **Parameters**: * `_amount`: The amount of feUSD stablecoin to withdraw from the Stability Pool. * `_doClaim`: A boolean indicating whether to claim accumulated yield and collateral gains during this operation. * **Return Values**: None Copy solidityCopyEditwithdrawFromSP(uint256 _amount, bool _doClaim) external ### [](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp#batch-liquidate-troves) **Batch Liquidate Troves** * **Contract:** Trove Manager Contract * **Purpose:** Executes the liquidation of multiple troves that are under the MCR threshold in a single transaction. This function is typically used to efficiently clear risky positions when the protocol detects unhealthy collateral ratios. * **Parameters:** * `_troveArray`: An array of `uint256` values, each representing the ID of a trove to be liquidated. * **Return Values:** None Copy batchLiquidateTroves(uint256[] memory _troveArray) public ### [](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp#redeem-collateral) **Redeem Collateral** * **Contract:** Collateral Registry Contract * **Purpose:** Enables users to redeem system collateral by burning a specified amount of feUSD. The redemption is performed against troves, starting from the trove with the lowest interest rate, and proceeding up to a maximum number of iterations. * **Parameters:** * `_feUSDAmount`: The amount of feUSD stablecoin to redeem in exchange for collateral. * `_maxIterationsPerCollateral`: The maximum number of troves to process for each collateral type during redemption. Used to bound gas usage. * `_maxFeePercentage`: The maximum acceptable fee (as a percentage, scaled by 1e18) the user is willing to pay for the redemption. If the actual fee exceeds this value, the transaction will revert. * **Return Values:** None Copy redeemCollateral( uint256 _feUSDAmount, uint256 _maxIterationsPerCollateral, uint256 _maxFeePercentage ) external [PreviousRisk Management](https://usefelix.gitbook.io/docs/advanced/risk-management) [NextMarket 2: Vanilla](https://usefelix.gitbook.io/docs/developers/market-2-vanilla) Last updated 2 months ago --- # FAQ | Felix [](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs/faq#general) General ----------------------------------------------------------------------------------------------------- ### [](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs/faq#what-are-vanilla-markets) What are Vanilla Markets? Felix Vanilla Markets are lending pools built on the Morpho stack. They let users borrow or lend tokens such as **USDC, HYPE, and UBTC** against over‑collateralised positions, all with floating interest rates derived from pool utilisation. ### [](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs/faq#how-are-they-different-from-the-cdp-market-feusd) How are they different from the CDP Market / feUSD? * **Asset‑native borrowing** — you can borrow any token, not just feUSD. * **No redemption mechanics** — therefore no borrower‑set fixed rates. * **Lower max‑LTV** and **variable APRs** that adjust block‑by‑block. ### [](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs/faq#why-borrow-through-vanilla-instead-of-the-cdp) Why borrow through Vanilla instead of the CDP? If you need direct exposure to a specific asset (e.g., HYPE to stake or USDC to LP) and don’t want redemption risk or swap slippage, Vanilla is simpler. ### [](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs/faq#when-do-i-need-to-repay-my-loan) When do I need to repay my loan? Loans are open‑ended; interest accrues continuously. You may repay at any time or maintain the position indefinitely as long as your **Health Factor stays above 1**. [](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs/faq#interest-rates) Interest Rates ------------------------------------------------------------------------------------------------------------------- ### [](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs/faq#how-are-borrow-and-supply-rates-determined) How are borrow and supply rates determined? Vanilla Markets follows a utilisation curve. As `Utilisation = Borrows / Supply` rises, **Borrow APR increases** and **Lender APY** tracks it minus a small spread. [](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs/faq#liquidations) Liquidations --------------------------------------------------------------------------------------------------------------- ### [](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs/faq#how-do-liquidations-work) How do liquidations work? If your Health Factor drops below 1.00, any liquidator can repay your debt and seize collateral at a discount. The process repeats until HF ≥ 1. ### [](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs/faq#how-can-i-avoid-liquidation) How can I avoid liquidation? * Keep HF > 1.25 for a cushion. * Add collateral or repay debt when collateral prices fall. * Use on‑chain alerts or an automation service. [](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs/faq#lenders) Lenders ----------------------------------------------------------------------------------------------------- ### [](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs/faq#where-does-the-lender-yield-come-from) Where does the lender yield come from? Purely from borrow interest. ### [](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs/faq#can-i-withdraw-anytime) Can I withdraw anytime? Yes, but if utilisation is high the contract may queue your withdrawal until enough borrows repay or new supply arrives. * * * [PreviousHow it Works](https://usefelix.gitbook.io/docs/money-market-products/publish-your-docs/how-it-works) [NextSmart Contract Audits](https://usefelix.gitbook.io/docs/advanced/smart-contract-audits) Last updated 6 months ago --- # Risk Management | Felix In addition to smart contract audits, we are working with [Anthias Labs](https://x.com/anthiasxyz) on day-one risk monitoring and parameterization of the Felix protocol to maintain protocol operations and to manage bad debt risk. 96KB [Felix Risk Management.pdf](https://2357968670-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FVH6och7EAxl0pIZxgbqv%2Fuploads%2FP1WJl4GvkIMEw4r6TXvT%2FFelix%20Risk%20Management.pdf?alt=media&token=4739bb70-f039-4e4e-b589-5fa4a382ee14) PDF Download[Open](https://2357968670-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FVH6och7EAxl0pIZxgbqv%2Fuploads%2FP1WJl4GvkIMEw4r6TXvT%2FFelix%20Risk%20Management.pdf?alt=media&token=4739bb70-f039-4e4e-b589-5fa4a382ee14) #### [](https://usefelix.gitbook.io/docs/advanced/risk-management#redstone-oracles) **RedStone Oracles** Felix uses RedStone Oracles as the primary solution for crypto assets pricing. [RedStone](https://redstone.finance/) is a Modular Oracle that delivers frequently updated, reliable, and diverse data feeds in a few models. [PreviousSmart Contract Audits](https://usefelix.gitbook.io/docs/advanced/smart-contract-audits) [NextMarket 1: feUSD CDP](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp) Last updated 6 months ago --- # Managing your borrow position | Felix ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/publish-your-docs#introduction) How to manage your position Users can manage their position or close their position at any time. To avoid liquidaton or redemptions against your position, you must ensure that you have a healthy collateralization ratio and healthy interest rate. To manage your position, find your position in the borrow page, and click on the manage button on the right. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/publish-your-docs#step-1-connect-wallet) Option 1: Add Collateral Users can deposit more collateral into their position if they want to increase the health of their position or borrow more feUSD. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/publish-your-docs#step-2-select-token-to-supply) Option 2: Withdraw Collateral Users can withdraw collateral if they would like to use their assets for other activities. Users can remove as much as they want, in so far as the minimum collateralization ratio is maintained. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/publish-your-docs#option-3-adjust-interest-rate) **Option 3: Adjust Interest Rate** Click the gear icon in the modal and slide to your desired fixed rate. * **Lower rate →** cheaper interest cost but your CDP sits earlier in the redemption queue. * **Higher rate →** safer from redemptions but you pay more interest. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/publish-your-docs#step-2-select-token-to-supply-1) Option 4: Borrow More Users can borrow more feUSD to engage in additional financial activity. Users can borrow as much feUSD as they want, in so far as the minimum collateralization ratio is maintained. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/publish-your-docs#step-3-approve-token-transfer) Option 5: Repay Borrow Users can repay their feUSD to increase the amount of outstanding debt in their position. All active positions must have at least 2000 feUSD oustanding. If you would like to repay all your debt, simply close your position instead (see below). ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/publish-your-docs#step-4-perform-supply-transaction) Option 6: Close Position (AKA Trove) Users can close their position to clear their outstanding feUSD debt and withdraw their collateral from the protocol. To close your position, users must pay off the outstanding feUSD debt, which is your borrowed amount and any additional interest added to the debt balance. Select the Close Trove option to close your position. [PreviousMinting / Borrowing feUSD](https://usefelix.gitbook.io/docs/money-market-products/quickstart/quickstart) [NextEarning feUSD yield](https://usefelix.gitbook.io/docs/money-market-products/quickstart/earning-feusd-yield) Last updated 6 months ago --- # Market 2: Vanilla | Felix [](https://usefelix.gitbook.io/docs/developers/market-2-vanilla#overview) Overview --------------------------------------------------------------------------------------- The Vanilla Markets is a borrow and lend market built on Morpho. * **Borrowers** deposit HYPE or other assets as collateral and can borrow USDhl, USDT0, USDe, etc. * **Lenders** deposit assets to earn borrower interest. #### [](https://usefelix.gitbook.io/docs/developers/market-2-vanilla#markets) Markets Market Market ID Liquidation Discount UETH / USDT0 0xf9f0473b23ebeb82c83078f0f0f77f27ac534c9fb227cb4366e6057b6163ffbf UETH / USDhl 0xb5b215bd2771f5ed73125bf6a02e7b743fadc423dfbb095ad59df047c50d3e81 kHYPE / HYPE 0x64e7db7f042812d4335947a7cdf6af1093d29478aff5f1ccd93cc67f8aadfddc kHYPE / USDhl 0xc0a3063a0a7755b7d58642e9a6d3be1c05bc974665ef7d3b158784348d4e17c5 kHYPE / USDT0 0x78f6b57d825ef01a5dc496ad1f426a6375c685047d07a30cd07ac5107ffc7976 WHYPE / USDe 0x292f0a3ddfb642fbaadf258ebcccf9e4b0048a9dc5af93036288502bde1a71b1 12.67% WHYPE / USDT0 0xace279b5c6eff0a1ce7287249369fa6f4d3d32225e1629b04ef308e0eb568fb0 12.67% WHYPE / USDhl 0x96c7abf76aed53d50b2cc84e2ed17846e0d1c4cc28236d95b6eb3b12dcc86909 12.67% UBTC / USDe 0x5fe3ac84f3a2c4e3102c3e6e9accb1ec90c30f6ee87ab1fcafc197b8addeb94c 7.41% UBTC / USDT0 0x707dddc200e95dc984feb185abf1321cabec8486dca5a9a96fb5202184106e54 7.41% UBTC / USDhl 0x87272614b7a2022c31ddd7bba8eb21d5ab40a6bcbea671264d59dc732053721d 7.41% wstHYPE / HYPE 0xe9a9bb9ed3cc53f4ee9da4eea0370c2c566873d5de807e16559a99907c9ae227 wstHYPE / USDT0 0xb39e45107152f02502c001a46e2d3513f429d2363323cdaffbc55a951a69b998 wstHYPE / USDhl 0x1f79fe1822f6bfe7a70f8e7e5e768efd0c3f10db52af97c2f14e4b71e3130e70 hwHLP / USDhl 0xe500760b79e397869927a5275d64987325faae43326daf6be5a560184e30a521 hwHLP / USDT0 0x86d7bc359391486de8cd1204da45c53d6ada60ab9764450dc691e1775b2e8d69 wHLP / USDhl 0x920244a8682a53b17fe15597b63abdaa3aecec44e070379c5e43897fb9f42a2b wHLP / USDT0 0xd4fd53f612eaf411a1acea053cfa28cbfeea683273c4133bf115b47a20130305 kHYPE-PT / HYPE 0x1df0d0ebcdc52069692452cb9a3e5cf6c017b237378141eaf08a05ce17205ed6 kHYPE-PT / USDT0 0x888679b2af61343a4c7c0da0639fc5ca5fc5727e246371c4425e4d634c09e1f6 kHYPE-PT / USDhl 0xe0a1de770a9a72a083087fe1745c998426aaea984ddf155ea3d5fbba5b759713 #### [](https://usefelix.gitbook.io/docs/developers/market-2-vanilla#lending-vaults) Lending Vaults Vault Address USDe 0x835febf893c6dddee5cf762b0f8e31c5b06938ab USDT0 0xfc5126377f0efc0041c0969ef9ba903ce67d151e USDT0 (Frontier) 0x9896a8605763106e57A51aa0a97Fe8099E806bb3 USDhl 0x9c59a9389D8f72DE2CdAf1126F36EA4790E2275e USDhl (Frontier) 0x66c71204B70aE27BE6dC3eb41F9aF5868E68fDb6 HYPE 0x2900ABd73631b2f60747e687095537B673c06A76 [](https://usefelix.gitbook.io/docs/developers/market-2-vanilla#liquidations) Liquidations ----------------------------------------------------------------------------------------------- Vanilla Markets are built on the standard Morpho smart contracts, which means liquidations follow the same mechanism as on Ethereum Mainnet or Base. Liquidations occur when a borrower's health factor falls below 1. Any third party—typically bots or keepers—can call the `liquidate` function to repay a portion of a borrower's debt and seize a corresponding amount of collateral at a discount. The relevant contract for liquidations of Vanilla Markets on HyperEVM is the **Morpho contract**, deployed at: Copy 0x68e37de8d93d3496ae143f2e900490f6280c57cd [View on Purrsec](https://purrsec.com/address/0x68e37de8d93d3496ae143f2e900490f6280c57cd/contract) ### [](https://usefelix.gitbook.io/docs/developers/market-2-vanilla#liquidate-function) Liquidate Function * **Contract:** Morpho Blue Core * **Purpose:** Liquidates an undercollateralized borrower's position by seizing collateral in exchange for repaying a portion of their debt. This helps maintain protocol solvency and allows liquidators to earn a liquidation bonus. * **Function Signature:** Copy liquidate( MarketParams memory marketParams, address borrower, uint256 seizedAssets, uint256 repaidShares, bytes calldata data ) external returns (uint256 seizedAssetsOut, uint256 repaidAssetsOut); **Parameters:** * `marketParams`: Struct containing the market’s configuration (collateral/loan asset addresses, oracle, lltv, etc.) * `borrower`: The address of the user being liquidated. * `seizedAssets`: The amount of collateral (in collateral token units) to seize. Set this to `0` if you're specifying `repaidShares` instead. * `repaidShares`: The amount of debt shares to repay. Set this to `0` if you're specifying `seizedAssets` instead. * `data`: Optional payload for advanced integrations. Used for callbacks or flash logic. **Return Values:** * `seizedAssetsOut`: The actual amount of collateral seized. * `repaidAssetsOut`: The actual amount of loan token paid to repay the borrower's debt. **Notes:** * **Either** `**seizedAssets**` **or** `**repaidShares**` **must be set to zero**. The protocol computes the corresponding value based on price and the liquidation incentive. * Only undercollateralized positions (health factor < 1) are eligible for liquidation. * A liquidation incentive is applied to reward the liquidator with a discount on the seized collateral. * A `onMorphoLiquidate` callback is supported if `data.length > 0`. **Example Use Case:** If a liquidator wants to repay a borrower's debt worth 1,000 USDT0, they can call `liquidate(...)` with: * `repaidShares` ≈ equivalent to 1,000 USDT0 worth of shares (calculated based on market totals) * `seizedAssets = 0` * Let the protocol compute the amount of collateral to seize (based on current oracle price and incentive factor) ### [](https://usefelix.gitbook.io/docs/developers/market-2-vanilla#open-source-bots) Open Source Bots #### [](https://usefelix.gitbook.io/docs/developers/market-2-vanilla#liquidation-bot-1) Liquidation Bot 1 **By:** [morpho-labs](https://github.com/morpho-labs/) **Languages and Tools:** Typescript & Solidity **Description:** A simple, fast, and easily deployable liquidation bot for the Morpho protocol. This bot is entirely based on RPC calls and is designed to be easy to configure, customizable, and ready to deploy on any EVM-compatible chain. **Repository:** [Morpho-liquidation-bot](https://github.com/morpho-org/morpho-blue-liquidation-bot) #### [](https://usefelix.gitbook.io/docs/developers/market-2-vanilla#liquidation-bot-2) Liquidation Bot 2 **By:** [morpho-labs](https://github.com/morpho-labs/) **Languages and Tools:** Typescript & Solidity **Description:** This contribution presents a simple implementation of a liquidation bot that can liquidate unhealthy position on Morpho. Using Typescript and Solidity. **Repository:** [Morpho-liquidation-bot-educational](https://github.com/morpho-org/morpho-liquidation-bot-educational) #### [](https://usefelix.gitbook.io/docs/developers/market-2-vanilla#liquidation-bot-3) Liquidation Bot 3 **By:** [etherhood](https://github.com/etherhood/) **Languages and Tools:** Rust & Solidity **Description:** This contribution presents a detailed strategy for liquidations using Rust and Solidity. **Repository:** [Liquidator-Morpho](https://github.com/etherhood/Liquidator-Morpho) #### [](https://usefelix.gitbook.io/docs/developers/market-2-vanilla#liquidation-bot-4) Liquidation Bot 4 **By:** [zach030](https://github.com/zach030/) **Languages and Tools:** Go & Solidity **Description:** This contribution presents a detailed strategy for liquidations using Go and Solidity. **Repository:** [morpho-liquidator-bot](https://github.com/zach030/morpho-liquidator-bot) [PreviousMarket 1: feUSD CDP](https://usefelix.gitbook.io/docs/developers/market-1-feusd-cdp) [NextRisk Disclosure Statement](https://usefelix.gitbook.io/docs/terms/risk-disclosure-statement) Last updated 2 months ago --- # Risk Disclosure Statement | Felix **Risk Disclosure Statement for Felix** Last Updated: 30 October 2024 The following Risk Disclosure Statement is intended to inform you (“User”) of the potential risks associated with interacting with the Felix Platform (“Platform”), which operates within the decentralised finance (DeFi) sector. By engaging with the Platform, Users acknowledge, understand, and accept the risks outlined below. This statement does not cover all possible risks, and Users are encouraged to consult with financial, legal, and technical advisors before using the Platform. 1. General Platform Risks 1.1. Decentralised Finance and Blockchain Risks The Platform operates on a blockchain-based infrastructure, which may expose Users to specific risks associated with blockchain technology and DeFi protocols. These risks include but are not limited to, potential issues with smart contracts, decentralised governance, transaction finality, and blockchain network reliability. Users should understand that blockchain-based services differ significantly from traditional finance and are still in a developmental stage. 1.2. Platform "As-Is" Basis The Platform and its services are provided on an “as-is” and “as-available” basis, without any warranties, express or implied. The Platform makes no guarantees regarding functionality, performance, reliability, security, or accuracy, and disclaims any liability for losses or damages arising from service unavailability or performance issues. 1. Financial and Market Risks 2.1. Market Volatility The value of digital assets is subject to extreme volatility. Price fluctuations in crypto-assets and collateral values may occur suddenly and without warning, leading to substantial and unpredictable changes in the value of User holdings. Users should be prepared for rapid changes in market conditions that could affect the performance of transactions conducted on the Platform. 2.2. Liquidation and Collateral Risks Users engaging in borrowing activities must monitor their collateral levels carefully. Failure to maintain sufficient collateral may result in automatic liquidation, leading to partial or total loss of the User’s collateralised assets without recourse. 2.3. Liquidity Risks Digital asset markets, including those involving the Platform’s native assets or collateral, may experience low liquidity. Limited liquidity can prevent Users from exiting positions or converting assets in a timely manner, potentially resulting in financial losses. Users should consider their ability to manage positions in low-liquidity conditions. 2.4. Redemption and Stability Pool Risks The Platform employs a redemption mechanism where holders of certain tokens may redeem collateral under specific conditions. Redemption risks include fluctuating redemption fees, variations in the availability of collateral, and other conditions that may impact the redemption process. Participation in Stability Pools, where Users earn rewards from liquidated collateral, may also be subject to variations in returns based on market conditions and Platform activity. 1. Technology and Security Risks 3.1. Smart Contract Risks The Platform relies on smart contracts deployed on a blockchain network, which are autonomous and irreversible by design. While smart contracts on the Platform have undergone testing and auditing, vulnerabilities or coding errors may still exist. Users acknowledge that interactions with smart contracts are at their own risk, and the Platform is not liable for losses resulting from smart contract malfunctions, coding errors, or exploits. 3.2. Cybersecurity Risks The Platform may be exposed to cybersecurity threats, including but not limited to hacking, phishing, denial-of-service (DoS) attacks, and other forms of unauthorised access. Despite the implementation of industry-standard security protocols, Users recognise that no platform is immune to security breaches. Any unauthorised access to User accounts or transactions may result in financial loss, and Users are advised to employ strong security practices, including protecting private keys and using secure wallet providers. 3.3. Blockchain Network Risks The Platform operates on public blockchain networks, which are subject to network-specific risks, including congestion, high transaction fees, potential downtime, and network reorganisation. Users should understand that blockchain network conditions may impact the timeliness, cost, and success of transactions on the Platform. The Platform disclaims responsibility for any losses arising from blockchain network-related issues. 3.4. Irreversibility of Transactions Blockchain transactions executed on the Platform are final and cannot be reversed once confirmed. Users are solely responsible for verifying transaction details before confirming them, as the Platform cannot alter or cancel transactions once submitted. 1. Regulatory and Legal Risks 4.1. Evolving Legal and Regulatory Landscape The legal and regulatory environment surrounding DeFi platforms and crypto-assets is rapidly evolving and may vary significantly across jurisdictions. Users should be aware that future regulatory actions could adversely affect their ability to use the Platform or hold certain assets. The Platform disclaims liability for losses or legal consequences arising from changes in laws, regulations, or regulatory interpretations affecting the Platform or its Users. 4.2. Jurisdictional Restrictions The Platform may restrict access to Users in certain jurisdictions where the use of crypto-assets or DeFi platforms is prohibited or highly regulated. Users are responsible for understanding and complying with the legal requirements of their jurisdiction before using the Platform. The Platform reserves the right to implement restrictions based on Users’ location as required to comply with applicable regulations. 4.3. Tax Obligations Users are solely responsible for determining and fulfilling their tax obligations related to transactions conducted on the Platform. The Platform does not provide tax advice, and Users are advised to consult with tax professionals to understand and comply with their local tax laws. 1. User Responsibility and Knowledge Assumption 5.1. User Diligence Users are expected to conduct independent research and due diligence before engaging with the Platform. Users should understand the functionality and risks of DeFi platforms, smart contracts, blockchain technology, and digital assets. The Platform is not liable for losses resulting from the User’s lack of knowledge or understanding of these subjects. 5.2. No Financial Advice The Platform does not provide investment, financial, legal, or tax advice. All information available on the Platform is for informational purposes only. Users are encouraged to seek professional advice before making any financial decisions or engaging in transactions on the Platform. 5.3. Self-custody and Private Key Management Users are solely responsible for the custody and security of their blockchain-based wallets and private keys. The Platform does not store, control, or manage private keys on behalf of Users. Loss of a private key or access credentials may result in the permanent loss of crypto assets, and the Platform is not responsible for any such loss. 1. Operational Risks 6.1. Platform Stability As a decentralised platform, Felix is subject to operational risks that may impact service availability. Maintenance, upgrades, or unexpected technical issues may temporarily disrupt the availability of Platform services. The Platform disclaims responsibility for losses incurred due to downtime, maintenance periods, or other interruptions in service. 6.2. Third-Party Service Dependencies The Platform may depend on third-party providers for wallet integration, blockchain infrastructure, analytics, and other services. Disruptions in these services could affect Platform functionality and user experience. Users acknowledge that the Platform is not liable for any losses caused by third-party service failures. 6.3. Forks and Protocol Changes Blockchain networks are subject to potential forks, upgrades, or changes to the underlying protocol. These events could impact the functionality, value, or accessibility of assets on the Platform. The Platform is not liable for losses arising from network forks, protocol changes, or incompatibility issues following such events. 1. Specific Risks Related to Platform Modifications and Development 7.1. Customization of Protocol Felix operates as a customised fork of the Liquity V2 protocol, introducing unique features and modifications. Users should be aware that modifications may introduce unforeseen risks, including vulnerabilities or deviations from the original protocol’s intended functionality. The Platform disclaims liability for losses arising from these modifications. 7.2. Governance and Decision-Making Felix may implement a decentralised or community-based governance model, wherein token holders may vote on or propose changes to the Platform. Governance changes may affect Platform features, fees, and other parameters, which may in turn impact Users’ positions. Users acknowledge that governance outcomes are determined by token-holder votes and may not always align with individual interests. 7.3. Updates and Feature Changes The Platform may introduce new features or make updates to existing ones. Users should be aware that new updates may alter the Platform’s functionality and risk profile. The Platform reserves the right to make such changes and disclaims responsibility for any adverse impacts resulting from updates or feature modifications. 1. Acknowledgement of Risk and No Recourse By using the Platform, Users acknowledge and accept all risks associated with their activities on the Platform and understand that the Platform is not liable for any financial losses, damages, or legal consequences resulting from the risks described in this Risk Disclosure Statement or other unforeseen circumstances. Users waive any claim or recourse against the Platform in connection with their use of the Platform. [PreviousMarket 2: Vanilla](https://usefelix.gitbook.io/docs/developers/market-2-vanilla) [NextTerms & Conditions](https://usefelix.gitbook.io/docs/terms/terms-and-conditions) Last updated 9 months ago --- # Earning feUSD yield | Felix ![](https://usefelix.gitbook.io/docs/~gitbook/image?url=https%3A%2F%2F2357968670-files.gitbook.io%2F%7E%2Ffiles%2Fv0%2Fb%2Fgitbook-x-prod.appspot.com%2Fo%2Fspaces%252FVH6och7EAxl0pIZxgbqv%252Fuploads%252Fo3oOAhDMilwMTvml7pMi%252F5%2520-%2520Earn%2520-%2520After%2520clicking%2520_Earn_.png%3Falt%3Dmedia%26token%3D23ad9f99-fc31-4726-9fa9-829e62e84342&width=768&dpr=4&quality=100&sign=52d91f60&sv=2) ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/earning-feusd-yield#introduction) Introduction Felix users can earn stablecoin yield on their feUSD, coming in the form of borrower interest and liquidation proceeds. To earn this yield, users must deposit feUSD into a Felix stability pool. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/earning-feusd-yield#introduction-1) Key Risks to be Aware Of **Risk** **What Triggers It** **What Happens** **How to Mitigate** **Liquidation Exposure** A borrower’s account / position health falls below its liquidation threshold. Your deposited feUSD is burned to cancel the debt; you receive the borrower’s collateral at face value. If that collateral keeps falling, its value may be less than the feUSD you lost. Monitor market conditions and CDP health metrics; be ready to swap received collateral back to stable assets promptly. **Bad-Debt Shortfall** Extreme market crash where seized collateral cannot fully cover the borrower’s debt. The Stability Pool absorbs the deficit, causing a net loss to depositors. Track overall system health (aggregate position collateralization, utilisation); diversify across pools and avoid overexposure. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/earning-feusd-yield#step-1-connect-wallet) Step 1: Connect Wallet To begin, press ‘Connect Wallet’ and select your preferred wallet provider corresponding to the wallet holding tokens intended to deposit as collateral. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/earning-feusd-yield#step-2-select-token-to-supply) Step 2: Select Supply Page Once connected, navigate to the ‘Supply’ page, which lists the possible Stability Pools that users can deposit into. You will be able to see the total deposited amount, the earn APY, and more. The purpose of the stability pool serves as a liquidation backstop for outstanding feUSD debt. Users take on bad debt risk and are compensated in the form of borrower interest and liquidation proceeds. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/earning-feusd-yield#step-2-select-token-to-supply-1) Step 3: Select amount to collateralize and feUSD borrow amount In the modal that pops up on the right, select the amount of feUSD that you want to deposit. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/earning-feusd-yield#step-3-approve-token-transfer) Step 4: Approve Token Transfer After clicking the confirm button, a modal will appear which will prompt a transaction or message signature request in the connected wallet. In order to transfer tokens on the Hyperliquid L1 network, the Felix smart contract must be granted an allowance to transfer tokens from the connected wallet address. Approvals can be performed through transaction. ### [](https://usefelix.gitbook.io/docs/money-market-products/quickstart/earning-feusd-yield#step-4-perform-supply-transaction) Step 5: Perform Deposit Transaction After the approval transaction, there will be one more transaction to confirm the transaction of depositing your feUSD into a Felix Stability Pool. Once you click confirm, you should be good to go in a few seconds! [PreviousManaging your borrow position](https://usefelix.gitbook.io/docs/money-market-products/quickstart/publish-your-docs) [NextFAQ](https://usefelix.gitbook.io/docs/money-market-products/quickstart/faq) Last updated 6 months ago --- # Terms & Conditions | Felix [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#general-terms-and-conditions-of-use) General Terms and Conditions of Use -------------------------------------------------------------------------------------------------------------------------------------------- ### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-1.-preamble) 1\. Preamble #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-1.1-purpose-and-scope) 1.1 Purpose and Scope: These Terms and Conditions ("Terms") govern the access to and use of the Felix Protocol ("Platform") accessible at https://usefelix.xyz including the user interface. The Platform is an all-in-one decentralised interface built on a Third-Party Blockchain Network. The Platform provides users with a comprehensive suite of tools and functionalities to manage their digital assets, interact with decentralised applications (“dApps”), and participate in staking and governance activities These Terms constitute a legally binding agreement between the user ("User") and Felix Labs ("Platform Operator"). The Platform Operator may update or amend these Terms from time to time, as outlined in Section 1.6. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-1.2-acceptance-of-terms) 1.2 Acceptance of Terms: By accessing or using the Platform, Users affirm that they have read, understood, and agreed to be bound by these Terms, including any amendments, updates, or modifications thereto and that they have the full legal capacity to enter into this agreement and are not prohibited from using the Platform under any applicable laws or regulations. If a User does not agree with these Terms in whole or in part, they must immediately discontinue their use of the Platform. Acceptance of these Terms is deemed to occur when a User: * Connects their blockchain wallet to the Platform; * Engages in any interaction with the Platform, including viewing or transacting; * Utilises any services provided by the Platform Operator or its affiliates through the Platform. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-1.3-professional-use-only) 1.3 Professional Use Only The Platform is intended for use exclusively by professional and knowledgeable Users acting in a business or professional capacity. It is not intended for use by individual consumers or companies that are not acting in their capacity as professionals. Accordingly, consumer protection laws do not apply to the use of the Platform. By accepting these Terms, the User certifies that they have sufficient expertise to understand and assess the legal and financial issues related to the use of the Platform. Users accessing the Platform represent and warrant that they are acting in a business or professional capacity. The User acknowledges and agrees that it is their responsibility to ensure their own competence, and if not, they must seek the advice of a qualified professional before proceeding with the use of the proposed services on the Platform. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-1.4-nature-of-the-platform) 1.4 Nature of the Platform: The Platform operates as an automated, decentralised protocol through autonomous Smart Contracts deployed on a Third-Party Blockchain Network. Users retain full control and responsibility over their assets and transactions, as set forth in Section 5 (Platform Operator). #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-1.5-registration-and-wallet-connection) 1.5 Registration and Wallet Connection To access the Platform, Users must connect a compatible blockchain wallet through the User Interface. Users need to be aware that their compatible blockchain wallet is provided by a third-party entity and is generally governed by separate terms and conditions set by the respective third-party service provider. By connecting their wallet, Users acknowledge and agree to the following: 1. Acceptance of Terms: The act of connecting a wallet constitutes acceptance of these Terms including full awareness and understanding of associated risks. 2. Understanding of Risk Disclosure: Users confirm that they have read and understood the Risk Disclosure outlined in Section 11 (Risk Disclosure). 3. Self-Custody Responsibility: Users are responsible for securing their blockchain wallets, private keys, and recovery phrases. The Platform Operator does not control the wallets, manage or recover lost credentials. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-1.6-amendments-and-modifications) 1.6 Amendments and Modifications: The Platform Operator reserves the right to amend, modify, or update these Terms at any time, at its sole discretion, to reflect changes in legal, regulatory, technical, or business requirements. Users will be notified of any material changes through official communication channels, including but not limited to: * Notices published on the Platform; * Email notifications (if applicable); * Updates within the Platform's user interface. Ongoing use of the Platform following any modifications signifies the acceptance of the updated Terms. Users are advised to regularly review the Terms to stay aware of their rights and duties. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-1.7-eligibility-and-restrictions) 1.7 Eligibility and Restrictions: The Platform is intended solely for individuals or entities that possess sufficient knowledge and expertise to understand the risks associated with the services offered on the Platform. By using the Platform, Users represent and warrant that: * Individuals are at least 18 years old or the age of majority in their jurisdiction, provided they are acting in a business or professional capacity as required by Section 1.3 (Professional Use Only); * They have the legal capacity to enter into binding agreements; * They will comply with all applicable laws and regulations; * They are not located in, under the control of, or a national or resident of any jurisdiction where the use of the Platform is prohibited or would subject the Platform Operator to any legal or regulatory liabilities. * They are not subject to economic sanctions imposed by the United Nations, the European Union, the United States, or any other applicable jurisdiction. The Platform Operator reserves the right to restrict or terminate access to Users who do not meet these eligibility criteria. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-1.8-compliance-and-regulatory-considerations) 1.8 Compliance and Regulatory Considerations: No Financial, Legal, or Tax Advice - The Platform Operator does not provide financial, legal, or tax advice. All information provided through the User Interface is for informational purposes only and should not be construed as advice of any kind. Users are solely responsible for ensuring compliance with all applicable legal, tax, and regulatory obligations in their jurisdiction. The Platform Operator makes no representations regarding the legality of the Platform's services in any specific country or region. Regulatory requirements and compliance obligations may vary, and Users should seek independent professional advice if needed. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-1.9-contact-and-support) 1.9 Contact and Support: For inquiries, support, or feedback regarding the Platform or these Terms, Users may contact the Platform Operator via official communication channels listed on the Platform's website. ### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-2.-definitions) 2\. Definitions For the purposes of these Terms, the following capitalised terms shall have the meanings set forth below, regardless of whether they appear in singular or plural form: * “Token” or feUSD Token refers to the native over-collateralized stablecoin of the Felix Protocol, designed to maintain a value close to one U.S. dollar. It is minted by users depositing eligible crypto assets as Collateral and serves as the primary settlement and liquidity token within the Felix ecosystem. The Token does not confer governance or membership rights. * “Token Transaction”: refers to any transfer, loan, exchange, minting, redemption, or interaction involving Tokens conducted through the Smart Contracts on a Third-Party Blockchain Network. * “Platform”: The Felix Protocol Platform refers to the decentralized financial ecosystem operated and maintained by the Platform Operator. The Platform operates independently of any central authority or intermediary, and its functionality is governed by the rules encoded within the Smart Contracts deployed on a Third-Party Blockchain Network. * “Platform Operator”: Felix Labs Inc, a company registered in the State of Delaware U.S and address 131 Continental Drive, City of Newark, County of New Castle - 19713, or any successor entity that assumes the Platform Operator’s obligations under these Terms. * “User”: Refers to any individual or entity accessing or utilising the Platform. * “User Interface” is the front-end web application and is an independent interface that allows Users to interact with the Smart Contracts. The User Interface simplifies interactions by enabling wallet connections, transaction submissions, and position monitoring, but it does not execute or control any Token Transactions on the Third-Party Blockchain Network. * “Smart Contracts”: Self-executing programs deployed on the Third-Party Blockchain Network that facilitate and govern Token transactions, * “Third-Party Blockchain Network”: A decentralized blockchain infrastructure that hosts the feUSD Token and its associated Smart Contracts. * “Gas Fees”: Refer to transaction fees paid to a Third-Party Blockchain Network to validate and execute Token Transactions. Users are solely responsible for paying Gas Fees, which fluctuate based on network demand. * “Applicable Laws” refers to the laws of Delaware and legal requirements that govern the use of the Platform, including but not limited to financial regulations, anti-money laundering (AML) laws, tax obligations, and data protection laws. * “Interim Measures” refer to temporary legal remedies or injunctions granted by a court or arbitrator to preserve the status quo or prevent imminent harm pending the outcome of a dispute resolution process. * “Arbitral Award” refers to the final and binding decision issued by an arbitrator in accordance with the Arbitration Rules of Delaware Uniform Arbitration Act (DUAA), as outlined in Section 13. * “Vault” means a Smart Contract account within the Platform that securely holds collateral or assets deposited by a User, and which enforces the applicable rules for minting, borrowing, repayment, and liquidation without reliance on intermediaries. * “Redemption” refers to the process by which Token holders can exchange their tokens for $1 worth of Collateral at face value from the Platform, minus any applicable fees. Redemptions are processed through the Smart Contracts against open debt positions with the lowest interest rates. * “Collateral” refers to eligible digital assets supported by the protocol (including the digital assets (ETH, Lido ETH (wstETH), Rocket Pool ETH (rETH)), HYPE, HUSD, USDC, LSTs, and any future assets added pursuant to protocol governance) deposited by Users into the Smart Contracts to secure their debt positions and mint feUSD. * “Stability Pool” refers to Smart‑contract pools into which Users may deposit eligible tokens (feUSD) to absorb liquidations of under-collateralised CDP Vaults, in exchange for receiving the underlying collateral and any associated protocol rewards. * “Vanilla Product/ Markets” are a set of lending and borrowing pools based on the Morpho Blue framework for native tokens (e.g., HYPE, HUSD, USDC), without redemption mechanics and with fully dynamic rates. Users may lend or borrow tokens, subject to protocol-defined interest rates. * “CDP Product/ Market” refers to a collateralized-debt-position (CDP) vault mechanism enabling Users to deposit eligible collateral assets to mint a stablecoin, subject to liquidation and redemption mechanics governed by Smart Contracts. * “Yield Pools” are pools where Users may supply eligible tokens to earn yield (including Stability Pools for feUSD), with returns derived from borrower interest, protocol fees, incentives, and/or liquidation gains as applicable. * “Market” is a distinct set of Smart Contracts and parameters governing a product primitive (e.g., feUSD CDP Market; Vanilla Markets). * “Liquid Staking Tokens (LSTs)” are tokenized receipts representing staked assets (e.g., staked ETH) that may be supported as eligible collateral, subject to protocol parameters and risk assessments. * “Oracles” refers to third‑party price feeds (e.g., RedStone or equivalent) used by the Smart Contracts to value Collateral and determine position health; oracle inputs may be delayed, unavailable, or inaccurate. * “Keepers” refers to independent actors who permissionlessly execute liquidations on undercollateralised positions in the CDP Product. * “Utilisation Curve” refers to a dynamic ratio reflecting how much of a market’s supplied liquidity is borrowed, which influences variable interest rates in Vanilla Markets. * “USDhl Product" is a fiat-backed stablecoin deployed by Felix Labs on HyperEVM, fully collateralised by U.S. Treasury bills and held in custody by the M0 Foundation, with reward distribution managed by Felix. * “M0 Foundation” is the custodian responsible for managing the fiat and treasury collateral backing USDhl. * "Collateralisation Ratios” means the ratio between the value of a User’s deposited collateral and the value of the debt or obligations issued against it, as determined by the Platform’s Smart Contracts. * “Proxy Contracts” refers to Smart Contracts structures that separate contract logic from data storage in order to permit upgrades or modifications to the contract after deployment. For the avoidance of doubt, neither the Vanilla Markets nor the associated Vaults employ proxy contracts, and all such components operate as immutable instances consistent with Morpho’s original security design, with modifications audited by independent third parties such as Three Sigma. The CDP Product similarly operates through immutable Smart Contracts administered via Felix-controlled governance mechanisms, without reliance on upgradeable proxy structures. ### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-3.-platform-description) 3\. Platform Description #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-3.1-decentralised-and-autonomous-infrastructure) 3.1 Decentralised and Autonomous Infrastructure The Platform is a decentralized and autonomous software infrastructure that operates through self-executing Smart Contracts deployed on a Third-Party Blockchain Network. It is designed to function without intermediaries, custodians, or centralized control. The Platform Operator provides access to the Platform through a User Interface but does not control, modify, or intervene in the execution of Token Transactions. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-3.2-core-features) 3.2 Core features * Collateralization: Digital assets accepted by the Platform to secure debt positions and mint feUSD. The Platform requires over-collateralisation to ensure system solvency and mitigate the risks of market volatility. * Access to Stability Pool: A pool of feUSD provided by Users to absorb the debt of liquidated positions. Stability Pool depositors are entitled to a share of the liquidated Collateral and may earn rewards for their contributions. * Vanilla Markets: Variable‑rate lending pools allowing Users to lend or borrow asset‑native tokens (e.g., HYPE, HUSD, USDC) directly; pricing follows a utilisation curve; no redemption mechanics. * Access to Yield Pools: Pools where Users may supply eligible tokens to earn yield (including Stability Pools for feUSD), with returns derived from borrower interest, protocol fees, incentives, and/or liquidation gains as applicable. * Strategy Combination: Users may combine primitives (e.g., mint feUSD via the CDP Market, lend it or other tokens in Vanilla Markets, or loop exposures), subject to Smart Contract rules and risks. * Oracle Dependency: The Platform relies on external price oracles for Collateral valuations and risk parameter enforcement. Disruptions, delays, or inaccuracies in price feeds may affect redemptions, liquidations, and borrow limits. ### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-4.-decentralisation-and-autonomy) 4\. Decentralisation and Autonomy The Platform is designed to operate without reliance on any centralised party: * Autonomous Smart Contracts: All transactions on the Platform are governed by Smart Contracts deployed on a Third-Party Blockchain Network. These contracts execute automatically based on predefined rules and conditions. * No intermediary role: The Platform Operator does not act as an intermediary in Token Transactions. Users interact directly with the Smart Contracts, assuming full responsibility for their transactions. ### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-5.-platform-operator) 5\. Platform Operator The Platform Operator provides and maintains the User Interface that enables Users to interact with the Platform’s Smart Contracts. The Platform Operator’s role is strictly limited to facilitating access to the Platform, and it does not control, manage, or intervene in Token Transactions conducted on the Third-Party Blockchain Network. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-5.1-duties-of-the-platform-operator) 5.1 Duties of the Platform Operator The Platform Operator shall, to the extent possible, provide and maintain the User Interface through which Users can access the Platform. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-5.2-no-custodial-services) 5.2 No Custodial Services The Platform Operator does not provide custodial services for any Tokens. Users remain solely responsible for securing their wallets, private keys, and recovery phrases as set forth in Section 9.1 (Security and Wallet Management). The Platform Operator: * Does not store or manage user assets: All Tokens are managed directly by the Smart Contracts on the Third-Party Blockchain Network. * Cannot recover lost credentials: The Platform Operator has no ability to recover lost or compromised private keys. * Issue Tokens: The Platform Operator has no control over the creation or destruction of Tokens, which is managed entirely by the Platform’s Smart Contracts. * Intervene in Transactions: The Platform Operator does not initiate, approve, or modify any Token Transactions conducted through the Platform. ### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-6.-access-and-use-of-the-platform) 6\. Access and Use of the Platform #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-6.1-wallet-connection-requirement) 6.1 Wallet Connection Requirement Users must connect a compatible blockchain wallet to access and utilise the Platform’s services. Users are responsible for ensuring that: 1. Their connected wallet is properly configured to interact with the Platform. 2. They have sufficient funds in their wallet to cover Token Transactions and associated Gas Fees. 3. They understand the mechanics and risks of interacting with Smart Contracts. The Platform Operator disclaims all liability for losses resulting from errors, misconfigurations, or unauthorised access to Users’ wallets. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-6.2-conditions-of-use) 6.2 Conditions of Use By connecting to the Platform, Users represent and warrant that they: 1. Are authorized to use the Platform: Users confirm that they have the legal capacity and authority to enter into a binding agreement under these Terms. 2. Are acting in a professional capacity: Users acknowledge that the Platform is intended for professional use by professional individuals or entities that have sufficient expertise to understand and assess the legal and financial issues related to the use of the Platform. Users represent that they are not accessing the Platform for personal, household, or consumer purposes. 3. Are Compliant with Applicable Laws: Users confirm that their activities on the Platform comply with all Applicable Laws. The Platform operates as a non-custodial decentralised protocol and does not itself perform customer due diligence, identity verification, or transaction monitoring. Users are solely responsible for ensuring that their use of the Platform complies with all applicable anti-money laundering (“AML”), counter-terrorist financing (“CTF”), and sanctions laws in their jurisdiction. By accessing the Platform, Users represent and warrant that their participation does not violate any such laws and acknowledge that any failure to comply may expose them to legal or regulatory consequences. The Platform Operator disclaims any responsibility or liability for Users’ non-compliance with AML/CTF obligations. 4. Are not subject to sanctions or restrictions: Users confirm that they are not subject to any sanctions or restrictions imposed under Applicable Laws. Users further confirm that they are not listed on any sanction lists maintained by competent authorities, do not directly or indirectly own or control any assets associated with sanctioned persons or entities, and have not received any assets from such persons or entities. Additionally, Users confirm that they will not engage in any transactions or activities on the Platform that involve individuals, entities, or jurisdictions subject to such sanctions or restrictions. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-6.3-security-and-user-responsibility) 6.3 Security and User Responsibility Users are responsible for securing their blockchain wallets and private keys. The Platform Operator does not manage, store, or recover User credentials, and Users must take all necessary precautions to prevent unauthorized access to their wallets. The User must: 1. Secure Their Wallets: Implement appropriate security measures, such as using hardware wallets and securing recovery phrases. 2. Verify Transactions: Carefully verify transaction details before initiating any Token Transactions through the User Interface or directly on the Third-Party Blockchain Network. The Platform Operator disclaims all liability for losses resulting from unauthorised access to User wallets or errors in Token Transactions initiated by Users. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-6.4-suspension-or-termination-of-access) 6.4 Suspension or Termination of Access The Platform Operator may suspend or terminate access to the User Interface at its discretion, including in cases of suspected breach of these Terms or engages in prohibited activities, as outlined in Section 9.3 (Prohibited Conduct). Users acknowledge that such suspension does not prevent continued interaction with the underlying Smart Contracts, which remain permissionless and outside the control of the Platform Operator. Users remain contractually bound by these Terms in all interactions with the Platform, whether through the User Interface or directly via Smart Contracts. Suspension or termination of access does not affect the User’s ability to interact with the Smart Contracts directly on the Third-Party Blockchain Network. Users remain responsible for managing their positions and complying with the protocol’s rules, even if their access to the User Interface is restricted. ### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-7.-platform-features) 7\. Platform Features #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-7.1-overview-of-services) 7.1 Overview of Services: The Platform provides a comprehensive range of decentralised services that enable Users to manage their digital assets, interact with decentralised applications, and participate in minting and other activities. The information provided in connection with access and use of the services is for informational purposes only. While the Platform operator aims to deliver accurate and reliable content, the Platform Operator cannot guarantee its accuracy, completeness, or timeliness. The information may be outdated, contain errors, or have omissions. Users should not make decisions or take actions based solely on the information available on the Platform, including, but not limited to, [https://usefelix.gitbook.io/felix-docs](https://usefelix.gitbook.io/felix-docs) or any other content provided, such as blog posts, data, articles, third-party links, news feeds, tutorials, tweets, or videos. The Users acknowledge and agree that the Platform Operator shall not be held responsible or liable, either directly or indirectly, for any damage or loss arising from, or allegedly caused by, the use of or reliance on any content, goods, or services accessed through such sites or resources. The key services offered by the Platform include, but are not limited to: 1. Minting Tokens: Users may generate Tokens by depositing eligible digital assets as collateral through the Felix Protocol’s Smart Contracts. Upon deposit, a collateralized debt position is created, and Tokens are minted proportionally to the collateral value, subject to the applicable collateralization ratio and Platform parameters. The minted Tokens are credited to the User’s connected wallet and may be used within the Felix ecosystem or across compatible decentralized applications. Users may repay their outstanding Token debt at any time to reduce or close their collateralized debt position. Upon full repayment of the minted amount (including any applicable fees), the corresponding collateral becomes available for withdrawal through the Felix Protocol’s Smart Contracts. Redemption and repayment are governed by the Protocol’s parameters and may be subject to market conditions, protocol updates, or collateral valuation requirements. 2. Borrowing or lending: Users may borrow or lend Tokens through the Felix Protocol at interest rates determined at their sole discretion and subject to the parameters displayed on the Platform. To borrow, Users must deposit eligible digital assets as collateral, with borrowing limits determined by the applicable collateral factors of such assets. The total borrowed balance includes both the principal and any accrued interest, which must be repaid in accordance with the Protocol’s terms. Users are responsible for reviewing the current borrowing and lending parameters and interest rate mechanisms as published on [https://usefelix.gitbook.io/felix-docs](https://usefelix.gitbook.io/felix-docs) 3. Redemption: Users may redeem Tokens through the Felix Protocol’s redemption mechanism in exchange for collateral at a notional rate of one U.S. dollar per feUSD, less any applicable fees. Upon redemption, the corresponding collateral is transferred to the User, and the overall debt positions within the Protocol are reduced in accordance with the applicable interest rate hierarchy. Redemptions may support the stability of the Token peg by adjusting circulating supply and collateral balances. 4. Stability Pool / feUSD System: The Stability Pool is an integral component of the Felix Protocol designed to maintain the solvency and stability of the Token over-collateralized stablecoin system. Users may deposit Tokens into Stability Pools, which automatically absorb the debt of liquidated positions, thereby ensuring protocol balance and preserving the Token peg to the U.S. dollar. In return, depositors receive a proportional share of the liquidated collateral, which may vary in value, along with potential rewards, bonuses, or yield as defined by the Protocol. Tokens deposited in the Stability Pool may be partially or fully burned during liquidations to offset borrower debt, and all processes operate in a non-custodial, permissionless manner through Smart Contracts. Felix Labs oversees the deployment and technical maintenance of the Stability Pool contracts, while parameters governing liquidations and reward distributions are defined within the Protocol and publicly available on [https://usefelix.gitbook.io/felix-docs](https://usefelix.gitbook.io/felix-docs) . 5. Monitoring Positions: Users must actively monitor their Collateralisation Ratios to avoid liquidation. The Platform provides real-time tools for Users to track the value of their Collateral and debt positions. 6. Liquidation Mechanism: The Platform includes a liquidation mechanism to maintain stability and solvency, where it automatically closes under-collateralised positions to prevent the Platform from accumulating debt. 7. CDP Product (Liquity Fork): The Felix Protocol’s Collateralized Debt Position (CDP) product is a fork of the open-source Liquity protocol, licensed to Felix under a perpetual, unlimited-use license. It operates through immutable Smart Contracts governed by a Felix-controlled multisig wallet, with no capacity for Felix or any third party to seize, redirect, or otherwise interfere with user funds.. Core risk parameters and collateral settings are managed by Felix multisig with advisory input from Anthias Labs. The protocol’s liquidations and redemptions are permissionless and executed by independent keepers. Twenty-five percent (25%) of all protocol fees are automatically routed to Felix Labs (U.S.) as revenue, while all modified code has been independently audited by Three Sigma, Coinspec, and Dedaub. Users are responsible for managing their collateralised debt positions to ensure that their Collateralisation Ratios remain above the Platform’s liquidation threshold. Users must adjust and review self-selected rates; CDP borrowers must review and, if needed, adjust their self‑selected rates to maintain healthy positions given redemption mechanics. Within the operation of the CDP Product, Users are strictly prohibited from engaging in abusive practices, including attempts to manipulate price oracles or exploit Smart Contracts through techniques such as re-entrancy or flash-loan attacks, for the purpose of gaining an unfair advantage in minting, redemption, or liquidation processes. 8. Vanilla Product (Morpho Blue Fork): The Felix Protocol’s Vanilla Product is a fork of the open-source Morpho Blue protocol, integrating the Morpho Markets and Morpho Vaults components under a perpetual license. Morpho Markets operate on a single contract instance originally deployed by the Morpho team, which retains control over certain parameters such as fees, while market creation remains permissionless and has been used by Felix Labs to deploy multiple markets. Morpho Vaults, deployed and owned by Felix Labs, allow Users to allocate capital across markets without manual redistribution and may use Felix-developed adaptors audited by Three Sigma for asset compatibility. Each Vault defines governance roles where Felix Labs acts as Owner, and Anthias Labs serves as Curator, Allocator, and Guardian, overseeing strategy approval, liquidity rebalancing, and risk management, including emergency interventions. Vaults collect fees from capital deployment and yield generation, of which ten percent (10%) are allocated to Felix Labs as revenue, while Anthias Labs is compensated for its management functions and the remaining proceeds are distributed to lenders. Neither the markets nor the Vaults employ Proxy Contracts, and all deployed components follow Morpho’s original security design, with all Felix modifications independently audited by Three Sigma. Users must monitor additional requirements applicable to Vanilla Markets and must monitor floating interest rates, utilisation‑driven APY changes, and collateral requirements applicable to Vanilla positions; promptly add collateral, reduce debt, or unwind positions to remain within protocol parameters. Within the operation of Vanilla Markets, Users are strictly prohibited from engaging in manipulative or exploitative behaviour, including attempts to distort utilisation curves, conduct wash-trades or self-referential borrowing activity, manipulate price oracles, or exploit Smart Contracts through techniques such as re-entrancy or flash-loan attacks, for the purpose of gaining an unfair advantage in interest rates, liquidity allocation, or liquidation processes. 9. USDhl Product (Fiat-Backed Stablecoin with M0 Foundation Technology): The USDhl Token is a fiat-backed stablecoin issued by Felix Labs on HyperEVM as a wrapper of the M0 Foundation’s “M token” technology, which represents U.S. Treasury bill holdings on Ethereum. Custody of the underlying collateral remains solely with the M0 Foundation, while Felix Labs manages the deployment and operation of USDhl on HyperEVM, including the distribution of rewards and integration with selected Hyperliquid platforms. Rewards are sourced from M0’s Ethereum treasury holdings and bridged to HyperEVM approximately once per month, after which Felix Labs converts them into HYPE Tokens and distributes them to eligible USDhl holders based on participation parameters. Felix Labs does not charge fees on USDhl issuance or redemption but retains control over the reward distribution pathway. The product employs no proxy contracts, has no DAO governance, and relies on the M0 Foundation’s custody and compliance infrastructure for collateral security. Felix Labs oversees the technical deployment and maintenance of the Smart Contracts, while end users hold USDhl and receive HYPE-denominated rewards passively through protocol-defined mechanisms. ### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-8.-fees-and-payments) 8\. Fees and Payments #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-8.1-fee-structure) 8.1 Fee Structure: 1. The use of services on the Platform may be subject to fees, which are determined by the Platform Operator and subject to change at any time. The applicable fees include but are not limited to: 1. Transaction Fees: Costs associated with executing Token Transactions, including Gas Fees. 2. Protocol Fees: Charges related to the delegation of the Token. All fees and allocations are executed automatically by Smart Contracts, with no discretionary intervention by Felix Labs or any third party. 1. CDP Product: Users do not pay minting or redemption fees. Protocol-level fees apply to CDP operations, of which twenty-five percent (25%) are allocated to Felix Labs as revenue. 2. Vanilla Markets: Vaults accrue fees from lending and borrowing activity. Ten percent (10%) of these fees are allocated to Felix Labs as revenue, with Anthias Labs separately compensated for its risk management functions. 3. USDhl: No fees are charged on issuance or redemption. Felix Labs manages the distribution of rewards but does not retain any portion thereof. 2. Users acknowledge and agree to pay all applicable fees in accordance with the current fees schedule published on the Platform. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-8.2-payment-methods) 8.2 Payment Methods: 1. Payments for Platform services shall be conducted exclusively through supported digital assets, including but not limited to the Token. The Platform does not allow payments in traditional fiat currency. 2. Users must ensure that they have sufficient funds in their connected wallet to cover any applicable fees, and failure to do so may result in the inability to access or complete certain transactions. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-8.3-fee-adjustments) 8.3 Fee Adjustments: 1. The Platform Operator reserves the right to adjust, introduce, or remove fees at its sole discretion. Any changes to the fee structure will be communicated to Users via: 1. Notices on the Platform; 2. Email notifications (if applicable); and 3. Updates within the Platform’s User Interface. 2. Users are encouraged to review the fee schedule periodically to remain informed of any updates. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-8.4-refund-policy) 8.4 Refund Policy: 1. All protocol-level fees (including but not limited to Gas Fees, protocol revenue allocations, or liquidation penalties) are irrevocable once executed on-chain and are not refundable under any circumstances. Any off-chain or User Interface service fees, if applicable, are non-refundable except as required by applicable law. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-8.5-billing-disputes) 8.5 Billing Disputes: 1. If a User believes they have been charged incorrectly, they must contact the Platform Operator within thirty (30) days of the transaction. Failure to notify the Platform Operator within this period shall result in the waiver of any claim related to the disputed charge. ### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-9.-user-obligations-and-responsabilities) 9\. User Obligations and Responsabilities #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-9.1-security-and-wallet-management) 9.1 Security and Wallet Management: 1. Users are responsible for the security of their blockchain wallets and private keys and must take appropriate measures to protect their assets, including but not limited to: 1. Implement Security Measures: Use hardware wallets, multi-factor authentication, and other security tools to protect their wallets. 2. Keep Recovery Phrases Secure: Store recovery phrases in a secure, offline location and ensure they are not shared with unauthorised parties. 3. Verify Transactions: Carefully verify transaction details before initiating any Token Transaction through the User Interface or directly on the Third-Party Blockchain Network. 4. Phishing and Social Engineering Attacks: Users must be vigilant against phishing attacks, fake websites, and social engineering attempts to steal their wallet credentials. 5. Unauthorised Transactions: Users are responsible for ensuring that their wallets are secure and that they do not authorise transactions from compromised devices or networks. 2. The Platform Operator shall not be liable for any losses resulting from a User's failure to secure their wallet credentials or errors in Token Transactions initiated by Users. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-9.2-general-obligations) 9.2 General Obligations: 1. By accessing and using the Platform, Users shall: 1. Provide accurate, current, and complete information when required; 2. Use the Platform only for lawful purposes and in accordance with these Terms; 3. Abstain from any activities that may interfere with the integrity, security, or performance of the Platform; 4. Failure to comply with these obligations may result in the suspension or termination of the User's access to the Platform. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-9.3-prohibited-conduct) 9.3 Prohibited Conduct: 1. Users shall not engage in any of the following prohibited activities while using the Platform: 1. Fraudulent Activities: Engaging in any fraudulent, deceptive, or manipulative conduct that could harm the Platform or other Users. 2. Unauthorised Access: Attempting to gain unauthorised access to the Platform, its systems, or any associated networks. 3. Exploitation of Vulnerabilities: Using the Platform to exploit bugs, vulnerabilities, or loopholes in Smart Contracts or Platform features. 4. Circumventing Fees: Users must not attempt to bypass Gas Fees, Platform Fees, or other costs associated with using the Platform. 5. Disrupting Network Operations: Users must not deploy bots, scripts, or other automated systems to disrupt or manipulate the Platform’s operations or other Users’ interactions with the Platform. 6. Unlawful Activities: Conducting or facilitating any activity that violates applicable laws, regulations, or legal obligations, including but not limited to money laundering, terrorism financing, or tax evasion. 7. Intellectual Property Violations: Infringing upon the intellectual property rights of the Platform Operator or any third parties. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-9.4-reporting-and-cooperation) 9.4 Reporting and Cooperation: 1. Users shall promptly report any suspected security breaches, unauthorised access, or other suspicious activities related to the Platform. The Platform Operator reserves the right to cooperate with regulatory authorities and law enforcement agencies in investigating any such incidents. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-9.5-suspension-or-termination-of-access) 9.5 Suspension or Termination of Access: 1. Any violation of the provisions in Section 9.3 (Prohibited Conduct) may result in legal action and the immediate suspension or termination of the User's access to the Platform. The Platform Operator reserves the right to suspend or terminate a User's access to the Platform if:: 1. The User violates these Terms or engages in prohibited conduct; 2. Required by applicable law or regulatory order; 3. The Platform Operator determines that continued access poses a risk to the Platform's security, stability, or integrity. 2. Users whose access has been suspended or terminated shall not attempt to re-access the Platform without prior written approval from the Platform Operator. ### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-10.-user-ackowledgments) 10\. User Ackowledgments Users interact directly with the Smart Contracts through their connected wallets. By initiating Token Transactions, Users acknowledge and accept the following responsibilities that they must familiarise themselves with the rules and conditions encoded in the Smart Contracts, including the risks of liquidation and redemption fees. The Smart Contracts may contain bugs or vulnerabilities that could result in unexpected losses. Failure to verify transaction details or understand the Platform’s rules may result in financial loss, for which the Platform Operator disclaims all liability. Users acknowledge and agree that their use of the Platform is subject to compliance with these Terms and all applicable laws and regulations in its jurisdiction, such as Anti-Money Laundering (AML) and Counter-Terrorism Financing (CTF) regulations, and specially in regards to: * Securities laws and regulations governing digital assets; * Data protection and privacy laws applicable in their jurisdiction. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-10.1-irreversibility-of-transactions) 10.1 Irreversibility of Transactions All Market and Pool Interactions conducted through the Smart Contracts are final and irreversible once confirmed on the Third-Party Blockchain Network. Users must exercise caution when initiating transactions, as they cannot be modified, reversed, or canceled once recorded on the Third-Party Blockchain Network. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-10.2-gas-fees-and-transaction-costs) 10.2 Gas Fees and Transaction Costs Users acknowledge that all transactions conducted through the Platform require Gas Fees paid to the Third-Party Blockchain Network to validate and process the transaction. * Responsibility for Gas Fees: Users are solely responsible for ensuring that their wallets contain sufficient funds to cover Gas Fees. * Fluctuation of Gas Fees: Gas Fees are determined by the underlying blockchain network, are subject to significant fluctuations based on demand, and may increase during periods of high congestion. The Platform Operator bears no responsibility for failed transactions caused by insufficient Gas Fees or network delays. * Failed Transactions: Transactions may fail if insufficient Gas Fees are provided. The Platform Operator disclaims liability for any failed transactions due to insufficient fees or network conditions. ### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-11.-risk-disclosure) 11\. Risk Disclosure #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-11.1-general-acknowledgment-of-risks) 11.1 General Acknowledgment of Risks: 1. Users acknowledge that the use of the Platform involves various risks inherent to blockchain-based services and decentralised finance (DeFi). By accessing and using the Platform, Users accept the following risks, including but not limited to: 1. Regulatory Risks: The regulatory environment for blockchain technology and digital assets is evolving, and Users must comply with all applicable laws and regulations. 2. Market Risks: Digital asset prices are highly volatile and can fluctuate significantly, leading to potential financial losses. The Platform Operator makes no guarantees regarding the stability or value of any digital asset. 1. Volatility of Collateral: The value of Collateral deposited in the Platform may decrease due to market volatility. A sudden drop in Collateral value may trigger liquidation, resulting in the loss of Collateral. 2. Peg Deviations: The market price of Tokens may deviate from its intended peg of $1.00. These deviations may result from market conditions or external factors. Users bear the risk of holding Tokens during such deviations. 3. Security Risks: Users are responsible for securing their accounts, wallets, and private keys against unauthorised access, phishing, and hacking attempts. 4. Liquidity Risks: There is no guarantee of liquidity for any digital assets, which may affect Users' ability to buy, sell, or exchange their holdings. 5. Network Congestion and Downtime: The Third-Party Blockchain Network may experience congestion, downtime, or technical failures that impact transaction processing. Users must be prepared for potential delays or transaction failures. 6. Blockchain Forks: The underlying blockchain network may undergo forks, updates, or changes that could affect the functionality of the Smart Contracts and the availability of the Platform. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-11.2-smart-contract-risks) 11.2 Smart Contract Risks: 1. Users acknowledge that the Platform relies on Smart Contracts deployed on the Third-Party Blockchain Network, which: 1. Are immutable once deployed and cannot be modified; 2. May contain bugs or security vulnerabilities despite auditing efforts. The Platform Operator does not audit or guarantee Smart Contracts. While the Smart Contracts may be audited by third parties, the Platform Operator does not guarantee their security or functionality. 1. Are subject to blockchain network conditions that may impact performance and availability. 2. Depend on third‑party oracles such as RedStone. Errors, delays, or manipulation may trigger liquidations or redemptions at non‑representative prices. The Platform Operator disclaims liability for oracle provider performance. 3. Users agree that they will conduct their own due diligence before interacting with any Smart Contracts on the Platform. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-11.3-third-party-risks) 11.3 Third-Party Risks: Users acknowledge that the Platform may integrate or rely on third-party services, including decentralised exchanges, liquidity providers, and wallet services. The Platform disclaims any liability for losses or disruptions caused by third-party services. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-11.4-no-guarantee-of-profit) 11.4 No Guarantee of Profit Users acknowledge that their participation in staking, trading, or other activities on the Platform does not guarantee profits. All financial decisions made by Users are at their own discretion and risk. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-11.5-incident-reporting) 11.5 Incident Reporting Users are encouraged to report bugs, vulnerabilities, or other issues to the Platform Operator through designated communication channels. The Platform Operator may, at its discretion, provide incentives and/or rewards in connection with the above. ### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-12.-limitation-of-liability) 12\. Limitation of Liability Users acknowledge that they assume full responsibility for their interactions with the Platform and agree to the following limitations on the Platform Operator’s liability. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-12.1-assumption-of-risks-for-users) 12.1 Assumption of Risks for Users The Platform Operator disclaims all liability for any losses or damages arising from Token Transactions initiated by Users on the Platform. Specifically, the Platform Operator shall not be liable for these risks, which are not limited to the following list: 1. Incorrect or unauthorised transactions: as outlined in section 9.1 2. Unauthorised access to wallets: as outlined in Section 6.3 3. Transaction failures: as outlined in Section 5.3. 4. Loss of private keys: Users are responsible for securing their private keys, recovery phrases, and other wallet credentials. The Platform Operator cannot recover lost credentials. 5. Bugs, vulnerabilities, or exploits: The Smart Contracts may contain bugs, vulnerabilities, or exploits that could result in unexpected behavior or loss of funds. 6. Protocol changes or forks: The underlying blockchain may undergo changes, including forks or upgrades, that could impact the functionality of the Smart Contracts. 7. Permanent Loss of Funds: Issues with the Smart Contracts may result in permanent loss of funds or positions. 8. Network Failures: Issues with the underlying Third-Party Blockchain Network, including node failures, network congestion, or attacks. 9. Regulatory Actions: Changes in laws or regulations that affect the operation or legality of the Platform. 10. Force Majeure Events: Acts of God, natural disasters, wars, cyberattacks, or other unforeseen events. If any jurisdiction limits the extent to which liability may be disclaimed or limited, the Platform Operator’s liability shall be limited to the maximum extent permitted by law. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-12.2-no-warranty) 12.2 No Warranty: The Platform is provided on an "as-is" and "as-available" basis without warranties of any kind, express or implied, including but not limited to: 1. Fitness for a particular purpose; 2. Non-infringement; 3. Accuracy, reliability, or availability of Platform services. ### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-13.-indemnification) 13\. Indemnification By accessing and using the Platform, Users agree to indemnify, defend, and hold harmless the Platform Operator and its affiliates, officers, directors, employees, agents, and representatives (collectively, the “Indemnified Parties”) from and against any and all claims, demands, damages, losses, liabilities, costs, and expenses, including reasonable legal fees, arising out of or related to: * User’s Use of the Platform: Any activities conducted by the User on or through the Platform, including interactions with Smart Contracts and Token Transactions. * Violation of Terms: Any breach by the User of these Terms. * Violation of Applicable Laws: Any breach by the User of applicable local, national, or international laws, regulations, or rules. * Third-Party Claims: Any claims brought by third parties as a result of the User’s actions on the Platform, including claims of intellectual property infringement, fraud, or illegal activities. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-13.1-scope-of-indemnification) 13.1 Scope of Indemnification The User’s indemnification obligation extends to the following: * Legal Costs and Fees: Reasonable legal costs, attorney fees, court costs, and expenses incurred by the Indemnified Parties in defending any claim. * Settlement Amounts: Any amounts paid in settlement of a claim, provided that the Platform Operator obtains the User’s consent before agreeing to a settlement (such consent not to be unreasonably withheld). * Damages and Losses: Any damages, losses, fines, penalties, or liabilities incurred by the Indemnified Parties as a result of the User’s actions. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-13.2-exceptions-to-indemnification) 13.2 Exceptions to Indemnification The User’s indemnification obligation does not apply to claims, damages, or losses arising solely from: 1. Gross Negligence or Willful Misconduct: Any gross negligence or willful misconduct by the Platform Operator or its affiliates. 2. Platform Operator’s Breach of Terms: Any fundamental breach of these Terms by the Platform Operator that directly causes harm to the User. The burden of proving that a claim falls within one of these exceptions lies with the User. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-13.3-third-party-claims) 13.3 Third-Party Claims If any third-party claim is brought against the Platform Operator or other Indemnified Parties as a result of the User’s activities on the Platform, the User agrees to: 1. Assume the Defense: Take responsibility for defending the claim at the User’s own expense. 2. Appoint Legal Counsel: Appoint legal counsel reasonably acceptable to the Indemnified Parties to manage the defense. 3. Reimburse Costs: Reimburse the Indemnified Parties for any expenses incurred in participating in the defense of the claim. The Platform Operator reserves the right to participate in the defense of any third-party claim at its own expense and to approve any proposed settlement terms. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-13.4-indemnification-process) 13.4 Indemnification Process The following process applies to any indemnification claim made under this section: 1. Notice of Claim: The Indemnified Parties must notify the User promptly upon becoming aware of any claim that may give rise to an indemnification obligation. Failure to provide timely notice does not relieve the User of their indemnification obligations, except to the extent that the delay materially prejudices the User’s ability to defend the claim. 2. Defense and Settlement: The User must assume control of the defense of the claim and may settle the claim only with the prior written consent of the Indemnified Parties. 3. Cooperation: The Indemnified Parties agree to cooperate fully with the User in the defense of the claim, including providing documents, information, and testimony as reasonably requested. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-13.5-limitation-on-indemnification-liability) 13.5 Limitation on Indemnification Liability The User’s indemnification obligations are subject to the following limitations: 1. Proportional Liability: The User’s indemnification obligation is limited to the extent that the damages, losses, or liabilities incurred by the Indemnified Parties are proportionally attributable to the User’s actions or omissions. 2. Jurisdictional Limitations: The indemnification obligations are subject to any limitations imposed by the laws of the jurisdiction governing these Terms, as outlined in Section 14 (Governing Law and Dispute Resolution). #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-13.6-no-waiver-of-immunity) 13.6 No Waiver of Immunity Nothing in this section shall be construed as a waiver of any legal immunity or defense available to the Indemnified Parties under applicable law. The Platform Operator reserves the right to assert any and all legal defenses to minimize its liability. ### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-14.-governing-law-and-dispute-resolution) 14\. Governing Law and Dispute Resolution #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-14.1-governing-law) 14.1 Governing Law: These Terms shall be governed by and construed in accordance with the laws of Delaware, without regard to its conflict of law provisions. Any dispute arising from or related to these Terms, including questions regarding their existence, validity, or termination, shall be resolved through arbitration in accordance with the provisions of this section. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-14.2-amicable-dispute-resolution) 14.2 Amicable Dispute Resolution: * In the event of a dispute arising from or relating to these Terms, the parties agree to resolve the dispute through the following process: * Negotiation: The parties shall attempt to resolve the dispute amicably through good-faith negotiations. * Mediation: If the dispute cannot be resolved through negotiation, it shall be referred to mediation administered by a mutually agreed-upon mediator. * Arbitration: The arbitration shall be conducted as follows: * Number of Arbitrators: The arbitration shall be conducted by a single arbitrator appointed in accordance with the Swiss Rules of International Arbitration. * Seat of Arbitration: The seat of arbitration shall be Geneva, Switzerland. * Conduct of Proceedings: The arbitration proceedings shall be conducted entirely online via email communications and web conferences, unless the parties agree otherwise in writing. * Language: The language of the arbitration shall be English. * Confidentiality: The arbitration proceedings, including all submissions, evidence, and decisions, shall be kept strictly confidential by the parties and the arbitrator. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-14.3-allocation-of-costs) 14.3 Allocation of Costs The party initiating the arbitration shall bear all costs and fees associated with the arbitration proceedings, including but not limited to: 1. Arbitrator Fees: The fees and expenses of the arbitrator. 2. Administrative Fees: Fees charged by the Swiss Rules of International Arbitration. 3. Other Costs: Any other costs incurred during the arbitration process. The arbitrator may, at their discretion, reallocate the costs of arbitration between the parties in the final Arbitral Award. However, each party shall be responsible for its own legal fees, consultant fees, expert fees, and other expenses incurred in connection with the arbitration, regardless of the outcome of the proceedings. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-14.4-class-action-waiver) 14.4 Class Action Waiver: Users agree that any disputes with the Platform Operator shall be resolved on an individual basis and not as part of any class action or representative proceeding. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-14.5-no-limitation-of-provisional-relief) 14.5 No Limitation of Provisional Relief Nothing in this section shall be construed as limiting the right of either party to seek provisional relief or Interim Measures from a court of competent jurisdiction to preserve the status quo or protect against imminent harm, pending the outcome of the arbitration. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-14.6-jurisdiction) 14.6 Jurisdiction In the event that any claim is not subject to arbitration under applicable law, such claim shall be submitted to the exclusive jurisdiction of the courts of the Delaware. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-14.7-survival-of-dispute-resolution-provisions) 14.7 Survival of Dispute Resolution Provisions The provisions of this section shall survive the termination of these Terms and shall remain binding on the parties with respect to any dispute arising from or related to the use of the Platform. ### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-15.-amendments-to-the-terms) 15\. Amendments to the Terms The Platform Operator reserves the right to amend, modify, update, or replace these Terms at any time to reflect changes in business practices, legal or regulatory requirements, technological advancements, or other relevant factors. Such amendments shall become effective upon publication of the updated Terms through the User Interface or another official communication channel designated by the Platform Operator. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-15.1-notification-of-amendments) 15.1 Notification of Amendments The Platform Operator will notify Users of any material amendments to these Terms by posting a Notice on the User Interface: A notification will be displayed prominently on the Platform. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-15.2-user-responsibility-to-stay-informed) 15.2 User Responsibility to Stay Informed It is the User’s responsibility to regularly review the Terms to stay informed of any amendments. The most current version of the Terms will always be accessible through a link on the User Interface. Users acknowledge that by continuing to access or use the Platform after the publication of amended Terms, they agree to be bound by the updated Terms. If a User does not agree with any amendment, they must: 1. Immediately discontinue use of the Platform; and 2. Cease all interactions with the Platform’s Smart Contracts. Failure to cease use of the Platform after the publication of amendments constitutes acceptance of the amended Terms. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-15.3-no-retroactive-amendments) 15.3 No Retroactive Amendments Amendments to these Terms shall not apply retroactively. Any transactions conducted on the Platform prior to the effective date of an amendment will be governed by the version of the Terms in effect at the time the transaction was initiated. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-15.4-future-products-and-markets) 15.4 Future Products and Markets The Platform Operator may introduce additional product primitives or Markets (including but not limited to new lending pools, collateral types, or structured products). Unless expressly stated otherwise, such features shall be governed by these Terms upon publication of an updated notice on the User Interface. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-15.5-severability-of-amendments) 15.5 Severability of Amendments If any amendment to these Terms is found to be invalid, unlawful, or unenforceable by a court of competent jurisdiction or through arbitration, the remaining provisions of these Terms shall remain in full force and effect. ### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-16.-intellectual-property-rights) 16\. Intellectual Property Rights #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-16.1-ownership) 16.1 Ownership: The Platform Operator retains all intellectual property rights related to the Platform, including but not limited to its design, content, software, trademarks, and underlying technology. Users may not copy, modify, distribute, sell, or lease any part of the Platform's intellectual property without the express written permission of the Platform Operator. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-16.2-license-to-use) 16.2 License to Use: Subject to compliance with these Terms, the Platform Operator grants Users a limited, non-exclusive, non-transferable, revocable license to access and use the Platform, including the intellectual property therein. This license does not grant Users any rights to: * Use the Platform for unauthorised purposes; * Reverse-engineer, decompile, or attempt to extract the source code of the Platform; * Use the Platform in any manner that infringes on the Platform Operator’s intellectual property rights. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-16.3-user-generated-content) 16.3 User-Generated Content: Users may upload, submit, or share content on the Platform, such as reviews or comments. By doing so, Users grant the Platform Operator a worldwide, non-exclusive, royalty-free license to use, reproduce, and distribute such content for the operation of the Platform. Users represent and warrant that they have the necessary rights to provide such content and that it does not infringe on any third-party intellectual property rights. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-16.4-reporting-infringements) 16.4 Reporting Infringements: If a User believes that their intellectual property rights have been infringed upon by any content on the Platform, they may submit a written notice to the Platform Operator at the designated contact address. The notice must include: * A detailed description of the alleged infringement; * Identification of the copyrighted work or trademark claimed to have been infringed; * Contact information of the complaining party. The Platform Operator will review such claims and take appropriate action as necessary, including content removal and/or account suspension. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-16.5-consequences-of-violation) 16.5 Consequences of Violation: Any unauthorised use of the Platform Operator’s intellectual property or violation of this chapter may result in: * Immediate termination of User access to the Platform; * Legal action to enforce intellectual property rights; * Compensation claims for damages incurred by the Platform Operator. ### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-17.-termination-and-suspension) 17\. Termination and Suspension #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-17.1-termination-by-user) 17.1 Termination by User: Users may terminate their access to the Platform at any time by ceasing to use the services and disconnecting their blockchain wallet. Termination does not relieve the User of any obligations incurred prior to the termination date. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-17.2-termination-by-platform-operator) 17.2 Termination by Platform Operator: The Platform Operator may suspend or terminate a User's access to the Platform without prior notice if: * The User violates these Terms; * The User engages in fraudulent or illegal activities; * Required by applicable law or regulatory authorities; * The security, integrity, or operation of the Platform is threatened. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-17.3-effect-of-termination) 17.3 Effect of Termination: Upon termination, the User’s access to all Platform services will be revoked. The User acknowledges that any staking rewards or pending transactions may be forfeited and that the Platform Operator holds no liability for any losses incurred. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-17.4-reinstatement) 17.4 Reinstatement: Users whose accounts have been suspended or terminated may submit a written request for reinstatement. The Platform Operator reserves the right to reinstate access at its sole discretion and may impose conditions for reinstatement. ### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-18.-miscellaneous-provisions) 18\. Miscellaneous Provisions #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-18.1-entire-agreement) 18.1 Entire Agreement: These Terms constitute the entire agreement between the User and the Platform Operator regarding the use of the Platform. They supersede all prior or contemporaneous communications, representations, or agreements, whether oral or written, relating to the subject matter of these Terms. No oral or written statements or representations not expressly included in these Terms shall be binding on either party. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-18.2-assignment) 18.2 Assignment: The Platform Operator may assign or transfer its rights and obligations under these Terms without the prior consent of the User, including in connection with a merger, acquisition, or sale of assets. Users may not assign or transfer their rights or obligations under these Terms without the prior written consent of the Platform Operator. Any attempted assignment or transfer without such consent shall be void and of no effect. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-18.3-notices) 18.3 Notices All notices or communications required under these Terms must be delivered in writing to the Platform Operator at the contact information provided on the User Interface or through other official communication channels specified by the Platform Operator. Notices to Users may be delivered via the User Interface, through notifications or updates posted on the Platform. Users are responsible for regularly checking the User Interface for notices from the Platform Operator. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-18.4-survival) 18.4 Survival: All provisions that by their nature should survive termination of these Terms shall survive, including, but not limited to, intellectual property rights, disclaimers, indemnity, and limitations of liability. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-18.5-force-majeure) 18.5 Force Majeure: The Platform Operator shall not be liable for any failure or delay in performing its obligations under these Terms due to events beyond its reasonable control, including but not limited to natural disasters, acts of government, war, cyberattacks, and technical failures. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-18.6-no-partnership-or-agency) 18.6 No Partnership or Agency: Nothing in these Terms shall be construed to create a partnership, joint venture, or agency relationship between the User and the Platform Operator. Each party acts as an independent entity, and neither party has the authority to bind or obligate the other in any manner. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-18.7-survival-of-provisions) 18.7 Survival of Provisions The following provisions shall survive the termination of these Terms and the User’s access to the Platform: * Section 9: User Obligations and Responsibilities * Section 10: User Acknowledgments * Section 11: Risk Disclosure * Section 12: Limitation of Liability * Section 13: Indemnification * Section 14: Governing Law and Dispute Resolution * Section 16: Intellectual-Property Rights * Section 18: Miscellaneous These provisions shall remain effective to the extent necessary to enforce rights and obligations that arose prior to termination or to address ongoing responsibilities. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-18.8-interpretation) 18.8 Interpretation The headings and section titles used in these Terms are for convenience only and do not affect the interpretation or meaning of the provisions. Any ambiguities or uncertainties in the language of these Terms shall not be construed against the drafter. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-18.9-language) 18.9 Language These Terms are drafted in the English language. If these Terms are translated into another language, the English version shall prevail in the event of any discrepancies or conflicts. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-18.10-no-third-party-beneficiaries) 18.10 No Third-Party Beneficiaries These Terms are for the sole benefit of the User and the Platform Operator. No third party shall have any rights to enforce any provision of these Terms, except where expressly stated otherwise. ### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-19.-user-privacy-and-data-security-data-collection-and-use) 19\. User Privacy and Data Security Data Collection and Use: The Platform Operator is committed to protecting the privacy of its Users. By using the Platform, Users acknowledge and consent to the collection and use of certain data, including but not limited to: * Blockchain wallet addresses; * Transaction history and interactions within the Platform; * Aggregated usage data to improve Platform functionality. All data collected will be handled in compliance with applicable data protection laws and regulations. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-19.1-user-responsibilities) 19.1 User Responsibilities: Users acknowledge and agree that they are responsible for safeguarding their personal data and blockchain credentials. Users must: * Use secure methods to store private keys and recovery phrases; * Avoid sharing sensitive information with unauthorised parties; * Regularly review their security settings. * The Platform Operator is not responsible for any unauthorised access resulting from the User’s failure to secure their personal information. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-19.2-third-party-services) 19.2 Third-Party Services: The Platform may integrate with third-party services that have their own privacy policies. Users acknowledge and agree that the Platform Operator does not control and is not responsible for the privacy practices of such third-party services. Users should review third-party policies before engaging with them. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-19.3-data-retention) 19.3 Data Retention: The Platform Operator retains collected data only for as long as necessary to fulfill the purposes outlined in these Terms or as required by applicable laws. Data may be deleted or anonymised after the retention period expires. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-19.4-user-rights) 19.4 User Rights: Users have the following rights regarding their data, subject to applicable laws: * The right to access their personal data collected by the Platform; * The right to request correction or deletion of inaccurate or incomplete data; * The right to withdraw consent for data processing, where applicable. Requests to exercise these rights should be submitted through official support channels provided by the Platform Operator. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-19.5-data-security-measures) 19.5 Data Security Measures: The Platform Operator implements industry-standard security measures to protect user data, including encryption, secure storage solutions, and access controls. However, Users acknowledge that no system is entirely immune to security breaches. #### [](https://usefelix.gitbook.io/docs/terms/terms-and-conditions#id-19.6-cross-border-data-transfers) 19.6 Cross-Border Data Transfers: By using the Platform, Users consent to their data being transferred and processed in jurisdictions that may have different data protection standards than their home country. The Platform Operator will take reasonable measures to ensure an adequate level of protection for cross-border data transfers. [PreviousRisk Disclosure Statement](https://usefelix.gitbook.io/docs/terms/risk-disclosure-statement) [NextPrivacy Policy](https://usefelix.gitbook.io/docs/terms/privacy-policy) Last updated 2 days ago --- # Smart Contract Audits | Felix Smart Contract Audits | Felix ---