Pool Leverage Ratios

In simple terms: when a higher number of Anchors contribute to a specific Borrower Pool, the Senior Pool increases the ratio with which it adds leverage.

To make this system work, the protocol needs to ensure that each Anchor is a separate individual. The protocol employs junior and senior tranches within Borrower Pools, aligning incentives and mitigating risks for both Anchors and Liquidity Providers.

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