This blog explains how we’re developing the SureVX P2P Collateral Management protocol. This protocol allows for the creation of collateral positions between counterparties which automatically manage margin calls, amongst other automated collateral management features.
We’re currently working on Single Pool Collateral which secures an exposure layer in one direction (that means the collateral taker will never be required to service a margin call regardless of movements in the underlying deal value).
A SinglePoolCollat is a collateralised position. It is serviced by a CollateralPool which contains some extra value over the initial collateralisation required at the opening of the position. The SinglePoolCollat has access to take and give this additional value as margin calls. The plan for creating these contracts on demand is this:
- We make a call to CollateralPoolRegister to create a CollateralPool. This call has an Ether payload.
- The CollateralPool is created and the Ether payload transferred to it.
- The CollateralPool, on contract open, automatically creates a SinglePoolCollat and transfers Ether to it.
This plan is what we’ve set out to achieve in this update. The basic structure of these contracts is below: