yoharsh14 / de-fi-aave

1. Deposit collateral: ETH/WETH ✅
2. Borrow another asset: DAI ✅
3. Repay the DAI ✅

// FORKING // TradeOffs

Pros: Quick,easy,resemble what's on mainnet Cons: We need an API, some contracts are complex to work with

Process:

Depositing

getWeth:

• First we have to get weth from the getWeth contract
• we used the mainnet contract address 0xC02aaA39b223FE8D0A0e5C4F27eAD9083C756Cc2
• In this process we used forking techinque.
• In forking we can interact with same blockchain.
• After we got weth in our wallet

Lending pool

• we have to get the address of lending pool
• we deposit the weth in lending pool

Lending pool address provider

• there are multiple lending pool
• so we have to get the address of the lending pool in order to depoist our WETH
• we use the lendingPoolAddressProvider interface to get the address of lendingPool.

lending pool

async function getLendingPool(account)

• Now that we have the address of the lending pool
• we can get the access using the address of lending pool.
• Now we can deposit but but but before depositing we need to give access aave to get WETH from wallet.
• We need to approve IERC20 so that it can access wallet

IERC20

async function approveErc20(erc20Address, spenderAddress, amountToSpend, account)

• With the help of function of IERC20 contract.
• We can approve for the access of our wallet.

Depositing

await lendingPool.deposit(address asset,uint256 amount,address onBehalfOf,uint16 referralCode)

• using above line we can deposit we in the leding pool.

Borrowing

getBorrowUserData

• Before borrowing we need to know about
  • how much we can borrow
  • how much we have in collatoral
  • how much we have borrowed
• liquidation concept
  • we you have 1ETH collatoral and borrowed 1.8ETH then you will get liquidated
  • Liquidation Threshold: The liquidation threshold is the percentrage at which a person is defined as undercollateralised. For example, a Liquidation threshold of 80% means that if the value rises above 80% of the collateral, the position is undercollateralised and could be liquidated.
  • if you have borrowed money more than you put up then people can take your collateral because they are paying for your loans.

GetDaiPrice

• Now we have info about how much can buy and how much debt we have
• before borrowing the DAI we need the conversion rate of ETH-DAI.
• for this we are going to use chainlink priceFeeds.

BorrwoDai

• Now that we know the exchange price of DAI/ETH
• we can borrow the DAI

Explanining how all the transactions work

• when we deposit our collatoral we actually get back an A token or an interset paring token
• It tracks how much collatoral or in our case how much WETH token we have deposited in the aave protocol.
• When we want to withdraw our WETH token we burn these A tokens.

1. First I have deposited WETH in my wallet.
2. In order to deposit in aave, I have fetched the address of lending pool
3. Deposited WETH token into lending pool
4. Then borrowed DAI with my deposited WETH as a collatoral.
5. After repayment of the DAI back to the aave/lending pool there is still some DAI left as borrowed
6. That lefted DAI is the intereset on the borrowed DAI. -------------------- COMPLETE WHOLE PROCESS -------------------------