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@ -3,7 +3,9 @@ const HowItWorks = () => {
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<div className="mt-6 rounded-lg border-2 border-th-fgd-1 bg-th-bkg-1 p-6">
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<h2 className="mb-1">Before you jump in</h2>
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<p className="mb-6 leading-relaxed">
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Make sure you understand how Boost! works before risking any funds.
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Boost! is high risk. Make sure you understand how it works before
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risking any funds. Please refer to the <a>Boost! docs</a> for the full
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technical details.
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</p>
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<h3 className="mb-1">The basics of JLP</h3>
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<p className="mb-3 leading-relaxed">
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@ -17,7 +19,7 @@ const HowItWorks = () => {
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all perp trading fees. This is automatically accrued in the price of JLP
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over time and is represented as an APR.
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</p>
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<h3 className="mb-1">The basics of Boost!</h3>
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<h3 className="mb-1">The basics of boosting JLP</h3>
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<p className="mb-3 leading-relaxed">
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Boost! offers a simple way to add leverage to your JLP position. It
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works by borrowing USDC against your deposited JLP and then swapping the
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@ -31,8 +33,55 @@ const HowItWorks = () => {
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yield you make a profit.
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</p>
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<h3 className="mb-1">Is boosting JLP always profitable?</h3>
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<h3 className="mb-1">Fees</h3>
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<h3 className="mb-1">Risks</h3>
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<p className="mb-3 leading-relaxed">
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No. For one, there is a real risk of liquidation. If the price of JLP
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drops below your liquidation threshold you will lose some or all of your
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JLP.
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</p>
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<p className="mb-3 leading-relaxed">
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There are also fees and costs for borrowing USDC that will affect your
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positions profitability.
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</p>
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<h4 className="mb-1">USDC Borrow Rate</h4>
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<p className="mb-3 leading-relaxed">
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This variable APR can change significantly and frequently depending on
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the ratio or USDC deposits and borrows. It is charged continuosly on the
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balance of your USDC borrow and paid to USDC depositors (lenders) on
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Boost!.
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</p>
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<h4 className="mb-1">USDC Loan Origination Fee</h4>
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<p className="mb-3 leading-relaxed">
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This is a one-time, 50 basis points (0.5%) fee applied to the balance of
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your USDC borrow and paid to Mango DAO.
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</p>
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<h4 className="mb-1">JLP Collateral Fee</h4>
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<p className="mb-3 leading-relaxed">
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This is charged on your JLP collateral as insurance in case JLP blows up
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and can't be liquidated. It will reduce the size of your JLP
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position over time. This fee accrues to Mango DAO.
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</p>
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<h4 className="mb-1">Position Entry Costs</h4>
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<p className="mb-3 leading-relaxed">
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When boosting JLP the USDC you borrow gets swapped via Jupiter to more
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JLP. This can incur some slippage resulting in an entry price worse than
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expected.
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</p>
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<p className="mb-6 leading-relaxed">
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So, for boosting JLP to be profitable the extra yield needs to be
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greater than these costs. It can also take some time for your position
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to be in profit because of the upfront fees paid to borrow USDC.
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</p>
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<h3 className="mb-1">Boosting USDC</h3>
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<p className="mb-3 leading-relaxed">
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Boosting USDC is simply supplying it to the lending pool. Your USDC
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balance will lent to JLP boosters and will continously earn the variable
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interest rate.
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</p>
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<p className="mb-3 leading-relaxed">
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There are no fees associated with lending USDC but there are risks. If
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there was a catastrophic failure in JLP or Boost! you could lose all of
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your funds.
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</p>
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</div>
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)
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}
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