From 9512f34b85be70be4ee22fb1cd90dd3e1bfb7b88 Mon Sep 17 00:00:00 2001 From: "dr. mia von steinkirch, phd" <1130416+mvonsteinkirch@users.noreply.github.com> Date: Tue, 7 Feb 2023 16:46:52 -0800 Subject: [PATCH] Update README.md --- liquidations/README.md | 12 +++++++----- 1 file changed, 7 insertions(+), 5 deletions(-) diff --git a/liquidations/README.md b/liquidations/README.md index 9c8245f..4d7c34d 100644 --- a/liquidations/README.md +++ b/liquidations/README.md @@ -1,4 +1,4 @@ -## liquidations +## liquidation
@@ -6,10 +6,10 @@
-* lending protocol work by requiring users to deposit some collateral. users can then borrow different assets and tokens from others depending on what they need, up to a certain amount of their deposited collateral. as the value of a borrower's collateral fluctuates, if the value of the borrowed assets exceeds the value of the collateral, the protocol allows anyone to liquidate the collateral (similar to margin calls in traditional finance). -* searchers compete to parse blockchain data as fast as possible to determine which borrowers can be liquidated and be the first to submit a liquidation transaction and collect the liquidation fee. -* example of strategy: bot detects a liquidation opportunity at a block and issues a liquidation tx, which is expected to be included in the next block. to compete with other liquidators, the bot sets high tx fees for their liquidation tx. -* another strategy: bot observes a tx that will create a liquidation opportunity (e.g., an oracle price update tx rendering a collateralized debit to be liquidated), then backruns this tx with a liquidation tx to avoid the fee bidding competition. +* **lending protocol** work by requiring users to deposit some collateral. users can then borrow different assets and tokens from others depending on what they need, up to a certain amount of their deposited collateral. as the value of a borrower's collateral fluctuates, if the value of the borrowed assets exceeds the value of the collateral, the protocol allows anyone to liquidate the collateral (similar to margin calls in traditional finance). +* **searchers compete** to parse blockchain data as fast as possible to determine which borrowers can be liquidated and be the first to submit a liquidation transaction and collect the liquidation fee. +* **example of strategy**: bot detects a liquidation opportunity at a block and issues a liquidation tx, which is expected to be included in the next block. to compete with other liquidators, the bot sets high tx fees for their liquidation tx. +* **another strategy**: bot observes a tx that will create a liquidation opportunity (e.g., an oracle price update tx rendering a collateralized debit to be liquidated), then backruns this tx with a liquidation tx to avoid the fee bidding competition.
@@ -28,6 +28,8 @@ ## resources +
+ * [anatomy of liquidator bots](https://github.com/go-outside-labs/mev-toolkit/blob/main/anatomy_of_mev_bots/bots/liquidators.md) * [liquidation dashboard, by eigenphi](https://eigenphi.io/mev/ethereum/liquidation) * [understanding compound's liquidation, by zengo](https://zengo.com/understanding-compounds-liquidation/)