Vowrepresents the overall Maker Protocol's balance (both system surplus and system debt). The purpose of the
vowis to cover deficits via debt auctions and discharge surpluses via surplus auctions.
Flopper(Debt Auction) is used to get rid of the
Vow’s debt by auctioning off MKR for a fixed amount of internal system Dai. When
flopauctions are kicked off, bidders compete with decreasing bids of MKR. After the auction settlement, the Flopper sends received internal Dai to the
Vowin order to cancel out its debt. Lastly, the Flopper mints the MKR for the winning bidder.
Flapper(Surplus Auction) is used to get rid of the
Vow’s surplus by auctioning off a fixed amount of internal Dai for MKR. When
flapauctions are kicked off, bidders compete with increasing amounts of MKR. After auction settlement, the Flapper burns the winning MKR bid and sends internal DAI to the winning bidder.
Flapcontracts help the MCD system operate?
Sin(the total debt in the queue). It sells an amount of minted MKR and purchases Dai that will be canceled 1-to-1 with
Vowwhile users bid with MKR, which will be burned, thus reducing the overall MKR supply. It will sell a fixed amount of Dai to purchase and burn MKR.
dentphase since they could return too much collateral to the original CDP and end up overpaying (i.e. pay too much Dai (
bid) for too few gems (
tickfunction will restart an auction if there have been 0 bids and the original
Flopauction expiring without receiving any bids, anyone can restart the auction by calling
tick. Along with restarting the auction, it also includes a necessary increase of the initial
pad(default to 50%). This extra process is because the lack of bidding for the
lotcould be due market circumstances, where the
lotvalue is too low and is no longer enough for recovering the
Bid.endbeing hit before the "true" price was found.
ttl) has passed. Hence, in the case when extreme network congestion occurs,
ttland auctions are affected because they can take longer than three hours to confirm a transaction. Therefore, due to Ethereum network congestion, this can result in auctions settling for less than the fair market value. Due to this potential issue, bidders need to calculate network congestion risks when making bids.