Stable non-blue chip

The Stable Non-Blue Chip kink model is designed to work with assets that are considered to be stable, such as DAI, MiMatic, and other stablecoins. These assets are not typically considered as "blue chip" as USDT or USDC but still used as stable collateral. The model sets an optimum collateralization ratio of 80% for these types of assets. This means that, in order to borrow assets, borrowers must provide at least 80% of the value of the loan in collateral. This lower collateralization ratio is used due to the fact that these assets, although stable, may be considered slightly more volatile than the blue chip assets, and thus lenders want to protect themselves by requiring more collateral.

Below this point, the liquidation ratio is relatively low, meaning that a relatively small amount of value in collateral is required to secure a loan. This is intended to encourage liquidity providers to supply assets to the platform, since they can do so with a relatively small amount of collateral.

As the collateralization level goes above this 80% point, the liquidation ratio increases rapidly. This is intended to protect the lender from too much risk in case the value of the collateral drops rapidly.

The key difference of this model with Stable Blue Chip kink model is the lower collateralization ratio due to the relatively higher volatility of this class of assets. The kink point or inflection point where the liquidation ratio "kinks" or changes from one slope to another is set at 80%.