Credit Default Swap on Aave Credit Delegation
0x68f7b841ecfa2b7fc7840366535c2751b9fec0dd2ebda1913d94445ae1c1027b
CDS Contract on AAVE Credit Delegation with maturity of 5 February 2021. Contract pays up to 0,1 WBTC and behaves as an insurance for credit delegation.
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Type | CDS |
Underlying | Credit Delegation Debt |
Oracle | Aave Lending Pool |
​ | 0x5dcdf6a17b95c5a9cc008f89893697e7ae1fface |
Contract size | 0,005 |
Trigger price | 0 |
Settlement | WBTC |
Buyer Margin* | 0 WBTC |
Seller Margin** | 0,1 WBTC |
Expiration | 5 February 2020 8:00 UTC |
Long wins^ | debt left * contract size |
Short wins^ | premium at settlement - any win of long |
​ | ^capped by the initial margin |
The derivative fee is 2.5% of the profit (only charges to profit makers) and received by derivative author
maximum risk of buyer; *Maximum risk of seller and maximum gain of buyer; cds contract traded with open price with via order book
A credit default swap (CDS) is a financial derivative or contract that allows an investor to "swap" or offset his or her credit risk with that of another investor.
For example, if a lender is worried that a borrower is going to default on a loan, the lender could use a CDS to offset or swap that risk. To swap the risk of default, the lender buys a CDS from another investor who agrees to reimburse the lender in the case the borrower defaults.
CDS requires a premium payment to create the contract, which is like an insurance policy.
A credit default swap is the most common form of credit derivative and may involve municipal bonds, emerging market bonds, mortgage-backed securities or corporate bonds.
