FAQ
Frequently asked questions about Creek
Protocol Overview
What is Creek Protocol?
Creek Protocol is a decentralized financial ecosystem built on gold assets. Through an innovative value separation model, it splits gold assets into stable value (sValue) and volatile value (vValue) components, enabling efficient utilization of gold assets with precise risk allocation.
How does the value separation model work?
The model splits total gold value (gPrice) into:
Stable Value (sValue): 90 and 120-day weighted price baseline value (stable component)
Volatile Value (vValue): gPrice - sValue (volatile component)
This creates 3 tokens: GUSD (USD-pegged stablecoin), GY (volatile exposure), and GR (stable value).
Gold Staking
How does Gold Staking work?
Deposit 1 XAUm → Receive 100 GY + 100 GR tokens → System mints GUSD reserves worth sValue. You can then hold, trade, or use these tokens as collateral.
What returns can Gold Stakers earn?
Multiple revenue streams:
GY appreciation: Leveraged exposure to gold price movements above EMA
GY trading: Sell for immediate returns
Collateral yield: Use GR to mint GUSD for other investments
Protocol dividends: 35% of protocol revenue distributed to GY holders
How do I redeem my Gold Token?
You need both 100 GY and 100 GR tokens, plus you must burn any GUSD you've minted. Redemption within 24 hours incurs 0.5% penalty.
GUSD Stablecoin
How can I mint GUSD?
Two methods:
GR Collateral: Use Gold Reserve tokens to mint up to 85% of their value in GUSD
Whitelisted Assets: Convert stablecoins like USDC at 1:1 ratio (0.1% fee)
What are the risks of minting GUSD with GR?
Main risks:
Liquidation risk: When collateral ratio drops below 110%
Stability fees: Annual rates of 3%-17% based on utilization
EMA decline: Falling EMA reduces GR value, increasing liquidation risk
GY Trading & Leverage
How does GY leverage work?
GY has intrinsic leverage = gPrice/vValue. Example: If gold is $2,100 and EMA is $2,000, leverage ratio is 21x. A 1% gold price increase could yield ~21% GY gains.
Risk Management
When will I be liquidated?
Liquidation triggers:
110% collateral ratio: Partial liquidation (up to 50%)
105% collateral ratio: Full liquidation possible
Liquidators get 5-7% discount on collateral
How does the protocol handle extreme market conditions?
Multi-layered defense:
EMA smoothing for short-term volatility
Progressive measures: Parameter adjustment → Liquidity support → Insurance fund → Emergency governance
30% of revenue goes to treasury reserves
Fees & Economics
What are the main fees?
Fee structure:
Gold staking: Free
GUSD minting (whitelisted assets): 0.1%
Early redemption (< 24h): 0.5%
Borrowing stability fee: 3%-17% annually
How is protocol revenue distributed?
Three-way split:
35% to GY holders
35% to GUSD LPs
30% to protocol treasury
Advanced Features
What is the dynamic stability fee?
Borrowing rates adjust based on utilization: r = 3% + 14% × U², where U is the utilization rate. Rates update every 6 hours or when utilization changes significantly.
What capital efficiency strategies are available?
Three approaches:
Conservative: Hold all GY+GR (lowest risk, lowest efficiency)
Balanced: Partial GY holding + some GUSD minting (moderate risk/efficiency)
Aggressive: Sell GY + maximum collateral use (up to 95% efficiency, higher risk)
Governance & Security
How is the protocol governed?
Progressive decentralization over 18 months, transitioning from core team control to full community governance. Emergency measures can be activated for security issues or extreme market conditions (>20% gold/EMA deviation).
How is security ensured?
Multiple audits, bug bounty programs, multi-source oracles, staged deployment, and emergency pause mechanisms protect the protocol.
Note: Parameters may evolve with protocol development. Refer to official documentation for the latest information.
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