Rewards for Liquidation Events

Governors who successfully liquidate loans are incentivized through a reward mechanism.

1. REFI Token Rewards: For each liquidation event they conduct, governors receive a reward of 50 REFI tokens. This not only incentivizes the maintenance of protocol stability but also aligns the interests of governors with the overall health of the platform.

2. Incentivizing Active Governance: By rewarding governors with REFI tokens, the platform ensures active and vigilant governance, crucial for maintaining the system's stability and trustworthiness.

Tthe liquidation mechanisms in Circularity Finance are designed to maintain the platform's stability and integrity, especially in the face of volatile market conditions. The use of ETF tokens as ERC1404 tokens allows for a controlled and diversified investment strategy, while the rewards for governors conducting liquidations ensure active and responsible management of the platform's assets and risk. This comprehensive approach to liquidations reflects Circularity Finance's commitment to creating a resilient and sustainable DeFi ecosystem.