Borrowing ebUSD
Overview
Ebisu uses Troves to manage loans. A Trove is a collateralized debt position linked to an Ethereum address. To borrow, users deposit supported collateral into a Trove and mint ebUSD. To withdraw their collateral, they must repay the ebUSD debt.
All Troves are overcollateralized and subject to protocol rules that maintain solvency, enforce risk isolation, and enable interest rate competition.
How to Borrow
Open a Trove — Choose a supported collateral (e.g., weETH, WBTC, sUSDe) and create a Trove.
Deposit Collateral — Select the amount of the asset you want to lock.
Choose Your Borrow Amount — Specify how much ebUSD you want to borrow.
Set Your Interest Rate — You can choose a competitive rate manually or delegate rate management to a third-party. Interest is added to the debt of your Trove and can be repaid anytime.
Approve & Confirm — Approve token transfers and confirm the transaction. Once complete, ebUSD is sent to your wallet.
Key Features
User-Set Interest Rates: You control your borrow rate. Lower rates mean lower cost but greater risk of redemption.
Yield Bearing Collateral: Collateral yield accrues to your Trove. If yield + collateral appreciation > interest rate, the user's loan effectively repays itself.
Overcollateralized Loans: Each loan must maintain a minimum collateral ratio or else face liquidation.
Flexible Repayment: Repay anytime to close your Trove and to recoup your collateral.
Rate Delegation: Automatically adjust your interest rate based on market conditions. (Coming soon)
Key Risks to Be Aware Of
Liquidation
Collateral price = liquidation price
Your debt is canceled, collateral seized, and redistributed to Stability Pool depositors. You keep any ebUSD you previously borrowed.
Maintain healthy CR, monitor markets, and add collateral/repay debt when loan health lowers.
Redemption
ebUSD trades below $1. Arbitrageurs purchase discounted ebUSD and call redeem() to exchange it for collateral, starting with the lowest-interest-rate Troves.
Your debt is repaid = to collateral value redeemed (ie. net 0 loss), but you lose collateral exposure (no fee/penalty).
Set a competitive rate relative to other Troves (see open Trove UI), use delegation, monitor ebUSD price for redemption risk.
Step-by-Step Guide
Step 1: Connect Wallet
Click "Connect Wallet" on the app and choose the wallet holding your collateral assets.
Step 2: Select Collateral Type
On the "Borrow" page, browse supported collateral options. Click "Open Trove" next to the asset you want to use.
Step 3: Input Collateral & Borrow Amount
Use the modal to input how much collateral you're depositing and how much ebUSD you want to borrow.
Step 4: Set Interest Rate
Choose your interest rate manually or opt to delegate it to an automated manager. Lower rates save on borrowing costs but increase redemption risk.
Step 5: Approve Token Transfer
Approve the collateral token so the Ebisu protocol can move it into the Trove smart contract.
Step 6: Confirm Transaction
Click confirm to finalize your deposit and mint ebUSD. You’ll see your position reflected in the dashboard.
Now you can start fishing for yield with ebUSD!
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