Use Cases

Use case – borrow/lending successful trade

Time	Lender (User 1)	Borrower (User 2)
Day 1	User 1 deposits 5 BTC into Pool A and receives 5 OXY_BTC. He wants to lend his 5 OXY_BTC out at 5% per annum which corresponds to 5% / 365 = 0.0137% for 1 day. User 1 enters into a trade to lend for 1-day BTC @ 5% per annum = 0.0137% for 1 day (rates are always entered as annual amounts). User 1 receives 5 OXY_IOU_BTC minted by the protocol and his 5 OXY_BTC tokens are transferred to the exchange. User 1 sells OXY_BTC for OXY_FUTURE_BTC The order is matched and the trade is made. Then his 5 OXY_IOU_BTC are burned and he receives 5.000685 OXY_FUTURE_BTC minted by the market. This is calculated by multiplying 5 * 100.0137% = 5.000685.	User 2 wants to borrow 5 BTC for 1 day at 5% per annum or 0.0137% per day . She enters a trade to borrow for 1-day BTC @ 5% per annum (rates are always entered as annual amounts). User 2 receives 5.000685 OXY_DEBT_BTC and 5.000685 OXY_IOU_FUTURE_BTC that are minted by the protocol. The protocol also creates 5 OXY_FUTURE_BTC that are transferred to the exchange to be traded into 5 OXY_BTC. The order is matched and the trade is made. Then the 5.000685 OXY_IOU_FUTURE_BTC are burned and 5 OXY_BTC are transferred to her pool wallet.
Day 2	User 1 earns 5% annualized interest for 1 day = 0.0137% * 5 BTC = 0.000685 BTC. User 1 receives 5.000685 OXY_BTC from the borrower and his 5.000685 OXY_FUTURE_BTC are transferred back to the protocol where they are burned.	User 2 pays 5% annualized interest for 1 day = 0.0137% * 5 BTC = 0.000685 BTC. User 2 transfers 5.000685 OXY_BTC to User 1 through the protocol and the 5.000685 OXY_DEBT_BTC are transferred back to the protocol where they are burned.

Time

Lender (User 1)

Borrower (User 2)

Day 1

User 1 deposits 5 BTC into Pool A and receives 5 OXY_BTC.

He wants to lend his 5 OXY_BTC out at 5% per annum which corresponds to 5% / 365 = 0.0137% for 1 day.

User 1 enters into a trade to lend for 1-day BTC @ 5% per annum = 0.0137% for 1 day (rates are always entered as annual amounts).

User 1 receives 5 OXY_IOU_BTC minted by the protocol and his 5 OXY_BTC tokens are transferred to the exchange. User 1 sells OXY_BTC for OXY_FUTURE_BTC

The order is matched and the trade is made.

Then his 5 OXY_IOU_BTC are burned and he receives 5.000685 OXY_FUTURE_BTC minted by the market. This is calculated by multiplying 5 * 100.0137% = 5.000685.

User 2 wants to borrow 5 BTC for 1 day at 5% per annum or 0.0137% per day .

She enters a trade to borrow for 1-day BTC @ 5% per annum (rates are always entered as annual amounts).

User 2 receives 5.000685 OXY_DEBT_BTC and 5.000685 OXY_IOU_FUTURE_BTC that are minted by the protocol.

The protocol also creates 5 OXY_FUTURE_BTC that are transferred to the exchange to be traded into 5 OXY_BTC.

The order is matched and the trade is made.

Then the 5.000685 OXY_IOU_FUTURE_BTC are burned and 5 OXY_BTC are transferred to her pool wallet.

Day 2

User 1 earns 5% annualized interest for 1 day = 0.0137% * 5 BTC = 0.000685 BTC.

User 1 receives 5.000685 OXY_BTC from the borrower and his 5.000685 OXY_FUTURE_BTC are transferred back to the protocol where they are burned.

User 2 pays 5% annualized interest for 1 day = 0.0137% * 5 BTC = 0.000685 BTC.

User 2 transfers 5.000685 OXY_BTC to User 1 through the protocol and the 5.000685 OXY_DEBT_BTC are transferred back to the protocol where they are burned.

Successful trade flowchart

Use case – lending cancelled trade

Time	Lender (User 1)
Day 1	User 1 deposits 5 BTC into Pool A and receives 5 OXY_BTC. He wants to lend his 5 OXY_BTC out at 5% per annum which corresponds to 5% / 365 = 0.0137% for 1 day. User 1 enters a trade to lend for 1-day BTC @ 5% per annum = 0.0137% for 1 day. User 1 receives 5 OXY_IOU_BTC minted by the protocol and his 5 OXY_BTC tokens are transferred to the exchange.
5 minutes later	User 1 cancels the trade. If the trade has not been matched and settled yet, then the 5 OXY_IOU_BTC tokens are burned and the 5 OXY_BTC are returned to the lender. The trade is now cancelled.

Time

Lender (User 1)

Day 1

User 1 deposits 5 BTC into Pool A and receives 5 OXY_BTC.

He wants to lend his 5 OXY_BTC out at 5% per annum which corresponds to 5% / 365 = 0.0137% for 1 day.

User 1 enters a trade to lend for 1-day BTC @ 5% per annum = 0.0137% for 1 day.

User 1 receives 5 OXY_IOU_BTC minted by the protocol and his 5 OXY_BTC tokens are transferred to the exchange.

5 minutes later

User 1 cancels the trade.

If the trade has not been matched and settled yet, then the 5 OXY_IOU_BTC tokens are burned and the 5 OXY_BTC are returned to the lender.

The trade is now cancelled.

Use case – cancelled borrowing trade

Time	Borrower (User 2)
Day 1	User 2 wants to borrow 5 BTC for 1 day at 5% per annum which corresponds to 5% / 365 = 0.0137%. She enters a trade to borrow for 1-day BTC @ 5% per annum which corresponds to 5% / 365 = 0.0137% for 1 day. User 2 receives 5.000685 OXY_DEBT_BTC and 5.000685 OXY_IOU_FUTURE_BTC that are minted by the protocol. The amounts of OXY_DEBT_BTC and OXY_IOU_FUTURE_BTC are calculated by multiplying 5 * 100.0137% = 5.000685. The protocol also creates 5.000685 OXY_FUTURE_BTC that are transferred to the exchange to be traded into 5 OXY_BTC.
5 minutes later	User 2 cancels the trade. If the trade has not been matched and settled yet, then the 5.000685 OXY_DEBT_BTC, the 5.000685 OXY_IOU_FUTURE_BTC tokens and the 5.000685 OXY_FUTURE_BTC are all burned. The trade is now cancelled

Time

Borrower (User 2)

Day 1

User 2 wants to borrow 5 BTC for 1 day at 5% per annum which corresponds to 5% / 365 = 0.0137%.

She enters a trade to borrow for 1-day BTC @ 5% per annum which corresponds to 5% / 365 = 0.0137% for 1 day.

User 2 receives 5.000685 OXY_DEBT_BTC and 5.000685 OXY_IOU_FUTURE_BTC that are minted by the protocol. The amounts of OXY_DEBT_BTC and OXY_IOU_FUTURE_BTC are calculated by multiplying 5 * 100.0137% = 5.000685.

The protocol also creates 5.000685 OXY_FUTURE_BTC that are transferred to the exchange to be traded into 5 OXY_BTC.

5 minutes later

User 2 cancels the trade.

If the trade has not been matched and settled yet, then the 5.000685 OXY_DEBT_BTC, the 5.000685 OXY_IOU_FUTURE_BTC tokens and the 5.000685 OXY_FUTURE_BTC are all burned.

The trade is now cancelled