When participating in liquidation, the liquidator needs to “substitute” the liquidated person to repay the debt to the system. In other words, the liquidator repays the debts for the liquidated person and can obtain mortgage assets equivalent to 10% of the debt value. This encourages participation in liquidation and improves the mobility of the system.
1.Go to the “Liquidation” page in the sidebar, you can see the current asset status of all users on the page. If Adequacy Ratio falls below 1, the collaterals of the lender will face liquidation. As shown in the picture below, the first three addresses in the list with Adequacy Ratios less than 1 are liquidable accounts. Click one to see the detailed liquidation page. Here we take the first one as example.
2.On the liquidation page, “Supply Assets” list on the left is the user’s collaterals to be liquidated, and “Borrow Assets” list shows the borrowing status of the user to be repaid.
Here we take liquating ETH in exchange for rETH as example. Select the collateral (rETH) on “Supply Assets”, then select the debt (ETH) you would like to repay the system for the liquidated user. You may need to click “ENABLE” to allow your wallet to access to your asset at the first time. Click “Confirm” in your wallet.
3.Enter the amount you wish to liquidate. The amount should not exceed the maximum wallet balance. Click “Liquidate” and confirm in the wallet.
4.After the transaction succeed, you can see the amount of ETH has been deducted from the wallet balance, and the corresponding amount of collateral (rETH) in “Supply Assets” has also decreased. The liquidation is complete now.
5.Now you can see a new asset card appears if you have not supplied rETH to Liqee before, or the balance of rETH deposition has changed under “My Assets”. This means that the collaterals from the liquidated person have been transferred to your account.