Contract Management
Managing your contract portfolio performance
New ARC account
As a new ARC account, you will only see the ability to create a new contract as a borrower or lender. You can click on the button to either borrow money or lend money.
Creating a Contract
All ARC accounts can create contracts as either a borrower or lender. Simply click on the button to Lend Money or Borrow Money. You will then be presented with a Create Contract form. In order to create the contract, you will need to know the email address associated with the account of the counterparty you wish to create the contract with.
Complete the form. The field descriptions are below.
Once you click Create Contract, you will see a notification that the contract was created and the ID of the contract.
If you click the X in the message, you will be returned to the main ARC dashboard. Here you will see all of your contracts. Totals are accumulated at the top where you can see at a glance how many contracts are in which states:
You will also see a list of current contracts and the current state the contract is in. Each contract row is clickable, which will take you to a specific view for that contract based on the current state.
Clicking on a contract row takes you to the contract details page. In this case, the contract is in a created state and is awaiting signatures. Since it is in a created state, both counterparties can edit the contract. Once the contract is approved by a counterparty, the only edits that can be made are to the Withdrawal Addresses for either Counterparty.
Editing a Contract
Clicking the Edit button will take you to the Edit Contract form. The same rules apply for the fields above.
Cancel a Contract
Clicking Delete will cancel a contract. Once cancelled, it can no longer be edited or executed.
Approve a Contract
Clicking the Agree button at the bottom signifies that you as the Lender or Borrower agree to the terms above and are willing to participate in the contract. Once you click Agree, you will get a notification depending on the number of approvals on the contract. If you are the first to agree, you will see a notification that the contract is awaiting approval of the other counterparty. If you are the second counterparty to agree, the notification will specify that the contract will start the execution and it could be several minutes to an hour for the execution environment to start. The Borrower will need to fund the contract before the contract is activated. The Borrower will receive an email when the deposit address is created.
Fund a Contract
Once the contract execution environment is available and a Bitcoin deposit address is created for the contract, the Borrower will receive an email stating the deposit address is available and can proceed with depositing the initial Bitcoin to fund the contract. On the details page, the Borrower will see the following view. The user can scan the QR code with their mobile device wallet app or copy the deposit address and paste into the wallet app.
Add Collateral to a Contract
If the price of Bitcoin drops enough to go into a margin call state, the Borrower will need to add Bitcoin collateral. On the contract details view, the Borrower will see a similar view to the Initial Deposit view, and will do the same sort of operation. Scan the QR code with the mobile device wallet app or copy and paste the deposit address and send the required amount of Bitcoin to the contract's deposit address.
Monitor Contract Performance
When a contract is active, both counterparties can view the current performance of the contract. There are several sections to the contract details page.
Loan To Value
The Loan To Value chart has multiple parts to it.
ARC Lightning Channel
This chart represents the current position of the collateral funds in the secure channel.
Bitcoin Price
This chart represents the price of Bitcoin since the start of the contract. The green bar represents the price at each block and the purple line represents the closing price at each day. The starting and ending daily prices are the start of the contract and the current price.
Risk Exposure
This chart is only shown to the Lender and shows their reduction of risk by using ARC. Risk is reduced during times when the Bitcoin price is dropping. By maintaining a reserve collateral amount and automatically reconciling collateral to the lender as the price drops, risk is often greatly reduced vs daily or hourly reconciliations.
Contract Transactions
This is a table of every transaction recorded when collateral is moved between counterparties.
Contract Terms
A simple table showing the agreed upon contract terms between the counterparties for reference and context.
On-chain Transactions
A table of your on-chain transactions. These can be the initial funding of a contract, any additional collateral added, secure channel opening or withdrawals at settlement.
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