Credit Delegation is a feature of Aave which allows a Credit Delegator to delegate the credit of their account's position to a Borrower. The terms of the Credit Delegation are decided and agreed between the parties off-chain, using OpenLaw.

Overview

• A legal agreement is signed between the parties using OpenLaw.
• The Credit Delegator (CD) creates **a Vault contract by interacting with the AaveCollateralVaultProxy contract, using the deployVault(address _asset) method.
• (Optional) The CD sets a borrow rate model, using setModel(AaveCollateralVault vault, uint model). If this call is not made, then a variable rate model is used by default.
• The CD sets the maximum borrowable amount using increaseLimit(address vault, address spender, uint addedValue).
• The CD deposits their aToken collateral into their vault, using deposit(AaveCollateralVault vault, address aToken, uint amount).
• The borrower can now borrow the amount needed, by using borrow(AaveCollateralVault vault, address reserve, uint amount).
• Once the borrowing position is active, the borrower can repay at anytime by approve-ing the amount to repay on the AaveCollateralVaultProxy, then using repay(AaveCollateralVault vault, address reserve, uint amount).
• When the terms of the agreement are finished, or at any point that the CD considers appropriate, the aToken collateral can be withdrawn using withdraw(AaveCollateralVault vault, address aToken, uint amount).
  • The borrow position must be fully repaid before all aToken collateral can be withdrawn.

OpenLaw Loan Agreement

An open source example of an OpenLaw loan agreement can be found here. This can be used (and improved) by anyone, however before signing the contract, the parties should seek legal counsel.

Methods

deployVault()

deployVault(address _asset)

Deploys a vault with _asset to be borrowed.

Returns the address of the newly deployed AaveCollateralVault.

setModel()

setModel(uint _model)