Collateralized Debt Positions (CDP)

CDP protocols allow users to lock up cryptocurrency or token as collateral to generate stablecoins or other assets. The collateral must be maintained above a certain value to avoid liquidation, ensuring the stability of the issued assets.

What You Need To Know

CDPs are a cornerstone of DeFi, enabling users to unlock liquidity while retaining ownership of their digital assets. They provide a decentralized alternative to traditional loans, fostering financial inclusion and innovation in blockchain-based ecosystems.