Arcus, launched by dYdX Labs with Robinhood Crypto, combines tokenized inventory buying and selling and perpetuals on Robinhood Chain.
Tokens Safe a $USDG Mortgage
Beforehand, Arcus perpetuals required margin in $USDG, the protocol’s settlement stablecoin. Beneath the brand new system, merchants transfer eligible holdings into their perpetuals accounts with out changing them. Deposited $USDG is used first; any extra margin want mechanically creates a $USDG mortgage secured by the tokens.
In response to Arcus’s documentation, the loans again cross-margin positions solely, the place positions share account collateral. Borrowed $USDG can’t be withdrawn or moved to an remoted place, and variable curiosity accrues whereas a mortgage is excellent.
All ten belongings have a 50% preliminary loan-to-value ratio: every greenback of collateral helps as much as fifty cents of borrowing for margin. That’s borrowing capability, not the utmost measurement of a leveraged perpetual place.
For a hedge, a dealer can maintain SPY tokens and use them to again a brief SPY perpetual. A foundation commerce equally pairs a token holding with an opposing perpetual place, normally to hunt funding funds. The change removes the necessity to provide separate $USDG margin, however the mortgage provides curiosity prices, and a hedge could not totally offset losses.
Deposit Caps and Liquidation
Arcus’s reside lending parameters confirmed non-$USDG deposit limits of $20,000 per account and $2 million platform-wide, alongside a $10,000 per-account borrowing cap.
Its collateral feed additionally confirmed platform-wide provide caps of 10,000 token models for every eligible inventory or ETF token and 1,000 WETH. These token-specific caps sit alongside the mixture greenback limits.
All ten belongings carried a 60% upkeep LTV within the feed. On the upkeep facet, Arcus compares maintenance-margin wants plus losses towards that collateral-based capability. Breaching upkeep capability or the per-account mortgage restrict triggers liquidation, in accordance with its documentation.
Liquidation cancels open orders and closes perpetual positions first. Collateral is offered solely to cowl any remaining shortfall, with the reside parameters crediting these gross sales at 99% of mark value. Falling collateral values and losses on perpetuals can each push an account towards liquidation.
The platform’s phrases bar perpetual buying and selling by customers within the U.S., Canada and the UK, amongst different restricted jurisdictions.
Closing a place doesn’t erase debt from realized losses, charges or curiosity. Any remaining mortgage have to be repaid via $USDG deposits, later buying and selling income or collateral gross sales.
