Liquidation

1. You can adjust your c-ratio by adding collateral or burning syASSETS.

2. You can self-liquidate to save on liquidation penalties. In this process, your staked collateral—sufficient to cover your outstanding debt plus a self-liquidation penalty of 10% and a flagger reward of $10, if applicable—is exchanged for SYNTH on a DEX and then distributed among liquidity providers and the flagger, if there is one.

3. Should you fail to maintain your c-ratio or self-liquidate yourself, a liquidator may initiate a chain-wise liquidation of your collateral. In this process, your staked collateral—sufficient to cover your outstanding debt plus a liquidation penalty of 20%, a flagger reward of $10, and a liquidator reward of $10—is exchanged for SYNTH on a DEX and then distributed among liquidity providers, the flagger, and the liquidator.

A flagger is someone who flags your position for liquidation, after which you have 8 hours to adjust your c-ratio. A liquidator is someone who triggers your liquidation.

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Calculate outstanding debt using the following formula:

• $R =Target \space c \text{\textendash} ratio$

• $D = Debt \space balance$

• $C = Collateral \space balance$

• $P = Liquidation \space penalty$

• $A = D - \frac{C}{R}$

• $B = 1-\frac{(1+P)}{R}$

• $Outstanding \space debt = \frac{A}{B}$