Open Position

About Open Position

A full description will be soon

Schema of Open Position

The next image shows a flowchart detailing the steps a trader takes to open a position with leverage, involving multiple transfers and actions among various entities.

Trader Open Position. Trader opens position in ETH for 1000 USDT with leverage x10. Market exchange rate is 2000 USDT for 1 ETH.

Example

Input information:

Trader opens position in ETH for 1000 USDT with leverage x10.

The market exchange rate is 2000 USDT for 1 ETH.

Start Balances:

• Balance controlled by D4X main smart contract:

  • Balance of external Lending protocol in ETH: 0 ETH

• Balance controlled by ALP:

  • Balance of external Lending protocol in USDT: 9000 USDT (from Lenders deposits)

• Balance of Trader: 1000 USDT

Actions:

1. Trader

   • Action 1: The trader orders to open a position with 10x leverage.

     • Transfer 1. from Trader: The trader transfers 1000 USDT to the D4X smart contract.

2. D4X Smart Contract

   • Action 2: D4X makes a leverage request to ALP.

3. Auto Leverage Pool (ALP)

   • Action 3: There's a request for receiving stored funds.

     • Transfer 3.1 from External Lending protocol: 9000 USDT is transferred from the External Lending Protocol to the ALP.

     • Transfer 3.2 to D4X smart contract: Subsequently, 9000 USDT is transferred to the D4X contract as part of the leverage process, making it a total of 10000 USDT (1000 initial + 9000 leverage).

4. D4X Smart Contract and DEX

   • Action 4: D4X starts exchange at an external Decentralized Exchange (DEX).

     The exchange rate for the transaction is 2000 USDT for 1 ETH

     • Transfer 4.1: The total 10000 USDT (from the trader's 1000 and 9000 leverage) is transferred to the external DEXes.

     • Transfer 4.2: In return, 5.0 ETH is received from the external DEXes, indicating the leverage has been used to purchase ETH.

   • Action 5: D4X initiates sending received from DEX funds to External Lending Protocol.

     • Transfer 5 to External Lending protocol: The 5.0 ETH is then transferred to the lending protocol to be stored.

End Balances:

• Balance controlled by D4X main smart contract:

  • Balance of external Lending protocol in ETH: 5.0 ETH (opened position)

• Balance controlled by ALP:

  • Balance of external Lending protocol in USDT: 0 USDT

• Balance of Trader: 0 USDT (all gone to position)

Result:

• Result for Trader: The trader received control of position in 5.0 ETH (with the aim of potential gain with x10 leverage), sent his own 1000 USDT, and borrowed 9000 USDT.

• Result for ALP: The pool lends 9000 USDT to the trader to earn interest.

Tutorial video

The upcoming video provides a step-by-step guide on how to initiate opening position within the application.

Tutorial Open Position