In Metronome Synth, there may be times when you would like to remove collateral or unloop your position in order to change variables. This guide will give a brief overview of how to perform a manual unloop in order to remove your collateral.
A Visual Guide
To manually repay and withdraw your position you first will need to acquire the synthetic asset you generated, for this example, we will be using msETH. You can do this by acquiring it via the open market with external assets, or you can remove a small amount of deposited collateral (bring health closer to 1.0 and swap a portion at a time) — the easiest and most straightforward method is to utilize external holdings to swap for the generated synthetic on Velodrome.
1. Head to Velodrome and click “swap”. This will enable you to swap any supported assets for msETH. You will need to manually enter the address for msETH which is: “0x1610e3c85dd44Af31eD7f33a63642012Dca0C5A5”.
After entering the token address you can swap any supported token for the collateral required for payback.
2. If the token you are swapping does not have a sufficient approval, Velodrome will require a token approval first in order to allow swapping. Once approved, you will be able to swap your token of choice for a metronome synthetic: in this example msETH.
3. Once you have acquired msETH successfully you will see the “swap successful” screen.
4. Now head over to Metronome and click “repay” by hovering over the asset you intend to repay.
5. In this example, we’re demonstrating a partial repayment. However, should you prefer to retrieve all of your collateral in a single operation, you can opt for full repayment. When you are ready, click “repay” in the Metronome UI.
6. Confirm the transaction.
7. Once confirmed, you will see your new health factor, and updated balance.
8. After partial or full repayment you can remove your collateral. In the event of a partial repayment, you will only be able to remove your collateral up to the point of the liquidation threshold. Please keep your health factor in mind as you perform this operation.
Example: If you’ve looped $5 in vaETH four times, yielding $20 in msETH, there are a couple of repayment options. If you decide to repay the full $20, you’re entitled to retrieve all of your initially deposited vaETH.
However, if you only repay $5 in msETH, you could withdraw up to $6.25 of the vaETH you deposited as collateral. This vaETH could then be converted back to ETH on Vesper, and subsequently, the ETH could be swapped for msETH on Velodrome. This sequence of steps enables you to repay your collateral efficiently.