Risk Management Models
Trumnix employs real-time risk management models to monitor market volatility, borrower behavior, and collateral values. The system dynamically adjusts interest rates, collateral requirements, and liquidity pool parameters to protect lenders and maintain platform stability.
Formula for Risk Assessment:
The Risk Index (RIRIRI) is calculated based on market conditions (MCMCMC) and borrower-specific factors (BFBFBF):
RI=α⋅MC+β⋅BFRI = \alpha \cdot MC + \beta \cdot BFRI=α⋅MC+β⋅BF
Where:
MC=f(ΔP,σP,TVL)MC = f(\Delta P, \sigma_P, \text{TVL})MC=f(ΔP,σP,TVL): Function of asset price changes (ΔP\Delta PΔP), price volatility (σP\sigma_PσP), and total value locked (TVL) in pools.
BF=g(CS,LR,DR)BF = g(CS, LR, DR)BF=g(CS,LR,DR): Function of credit score (CSCSCS), loan-to-value ratio (LRLRLR), and default risk (DRDRDR).
α,β\alpha, \betaα,β: Weights assigned to market and borrower factors, dynamically updated based on model feedback.
Protocols:
Collateral Liquidation Protocol: Automatically liquidates collateral when RIRIRI exceeds a predefined threshold, ensuring lenders' funds remain secure.
Dynamic Rate Protocol: Adjusts interest rates based on RIRIRI, rewarding low-risk borrowers with lower rates and protecting lenders from high-risk borrowers.
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