Borrowing

Loans at the floor

Lock coins and borrow their floor value:

The cash comes out of the coin's floor reserve, but the loan is owed back, so it still counts toward the reserve. The locked coins still count as circulating supply. Taking a loan never lowers the floor for anyone else, and the part of its fee paid into the reserve, 1% of the loan, lifts it slightly.

Terms

• Amount: floor price × coins locked.
• Interest: 0%.
• Length: you pick it, from 1 to 90 days. Repay any time before it ends; once it ends, the loan can no longer be repaid.
• Origination fee: 2% of the loan, charged up front. 1% goes to the protocol and 1% to that coin's floor reserve.
• Price feed: none. There is no oracle and no liquidation price.

Repay or keep the cash

Repay exactly what you borrowed, before the term ends, to get your coins back. Anyone can repay a loan, and the coins always go back to the borrower. The cash goes back into the reserve in place of the loan, so the floor does not move. Your locked coins counted as circulating the whole time, so if fees lifted the floor while the loan was open, your coins rose with everyone else's.

If you do not repay within the term, you keep the cash and the locked coins are sold into the pool when the term ends. Anyone can start that sale once the term is over. The sale works like any other: floor price × coins leaves the reserve as the coins leave circulation, so the floor does not fall. It pays no trading fee, and the coins never sell below the floor, so the proceeds always cover the loan, which is paid back into the reserve.

Whatever the coins fetch above the loan is Hardfloor's profit, and all of it buys $FLOOR, the Hardfloor token, on the market and burns it. The sale pushes the coin's price down the pool like any other sale, never below the floor. There are no margin calls along the way: nothing happens to the loan before the term ends, whatever the price does.

Looping

Looping means buying coins, locking them, borrowing against them and buying again with the loan. In phase 2 the whole loop runs in one transaction: it buys the coins, locks them and borrows their floor value at once, so you pay the price less the loan. Because the loan is only the floor value, leverage has a hard limit:

Looping also magnifies losses. If the price falls to the floor, a fully looped position is worth only what was borrowed against it, so the whole starting stake is gone. Without looping, you would still hold the floor value of your coins.

Compared with oracle-priced lenders

Oracle-priced lenders lend a fraction of a coin's market price and liquidate the loan when that price falls. Hardfloor loans are sized by the floor instead.

The trade-off for a young coin: less cash up front, in exchange for no oracle and no sale before the term ends.