FAQs
Frequently Asked Questions
General
Why HZN?
Focused on user experience and education
Community driven
Focused on bringing a wider range of synthetic assets that represent the real and crypto worlds with low trading fees, deep liquidity, and 0 slippages.
A DeFi Derivative Powerhouse: Building more innovative trading features such as AI trading, one-click arbitrage and hedging ...etc
Bringing DeFi to NFTs via Synthetic NFTs
Cross-chain interoperability: BSC, ETH and more.
What are the tokenomics of HZN?
To understand the tokenomics please refer to our Supply and Inflation Policy article.
What was the initial minted distribution for HZN?
The initial minted supply of HZN tokens is 100,000,000.
Distribution:
10% (10,000,000 HZN) will be reserved for the IFO on PancakeSwap.
30% (30,000,000 HZN) will be reserved for Liquidity Mining purposes.
60% (60,000,000 HZN) will be reserved for the Ecosystem & Community Fund.
How will the ecosystem funds be used?
The Ecosystem & Community Fund will be used to support the protocol and community via stabilization of synthetic asset collateralization, market making for synthetic assets, protocol grants and blockchain fees, bounties, partnerships, marketing, and other community incentives. None of these funds are going to the team, advisors, or investors and are not intended to ever be completely circulating in the market. This fund is the treasury of Horizon Protocol itself and is for the benefit and long term sustainability of the protocol. The intention for this fund is to eventually be completely governed by the community via a DAO.
Will there be a deflation mechanism later?
As our project evolves, we can certainly begin to implement deflationary mechanisms. If you wish to contribute to the discussion around this, please join our Telegram community here.
Can we see any statistics in real-time?
To see real-time network data and analytics for Horizon Protocol, check out the Network Page.
Where can I submit a bug/suggestion report?
Please go to our Telegram to report bugs, provide feedback and suggestions, or request a new feature.
Staking
How do I stake my HZN?
To stake HZN you also need to mint zUSD, which is a stablecoin backed by your staked HZN. This zUSD must be paid back in order to reclaim your HZN and is considered as an interest-free debt. Staking HZN requires managing your Collateralization Ratio (C-Ratio) in order to be eligible for rewards and avoid liquidation.
How can I unstake HZN?
You must burn zUSD in order to unstake HZN. Burning zUSD will reduce your debt which also reduces the amount of HZN required to back that debt.
Any zUSD burned while under an 600% C-Ratio will only reduce your debt and increase your C-Ratio, but will not unstake any HZN.
Any zUSD burned while over an 600% C-Ratio will reduce your debt AND unstake HZN at an 600% ratio. Reducing your debt to 0 would unstake all of your HZN. Unstaked HZN would become 'transferable' HZN, which is freely usable HZN.
*Please note that the Target C-Ratio is subject to change based on community feedback. For the most up to date Target C-Ratio, visit the Network Stats page.
Why can I still see my HZN in my wallet even though I have staked it?
When staking HZN in Horizon Protocol, your HZN will never actually leave your wallet. Horizon Protocol will automatically flag your HZN as 'staked' rendering it unusable until you unstake your position. HZN that isn't staked will be considered 'transferable' and freely usable to transfer or sell.
Why is my HZN staked amount constantly changing?
Horizon Protocol has a dynamic staking mechanism that automatically adjusts the amount of HZN staked based on the current price of HZN in order to always maintain an 600% backing of your current debt. Transferable and escrowed HZN are dynamically used to maintain an 600% C-Ratio as the price of HZN fluctuates.
Let’s take an example:
You mint 100 zUSD with 600 HZN (1 HZN = $1) at 600% C-Ratio, your staked HZN balance would be 600 and your transferable HZN balance would be 0 (assuming you staked all of your HZN).
The price of HZN goes up to $1.5, now you would only need 400 HZN to back your 100 zUSD. Horizon Genesis would automatically release 200 HZN from being staked and it would become transferable HZN. This transferable HZN could then be freely used to mint more zUSD, transferred to another wallet, or sold on an exchange.
The price of HZN drops to $0.5, then you will need 1,200 HZN (1200 x $0.5 = $600) to back your 100 zUSD debt position. Horizon Genesis will automatically migrate any transferable or escrowed HZN in your wallet to become staked HZN until the necessary 1200 HZN backing is met. If you don’t have any transferable HZN, then your C-Ratio will fall below the 600% target C-Ratio and you will no longer be able to claim rewards.
*Please note that the Target C-Ratio is subject to change based on community feedback. For the most up to date Target C-Ratio, visit the Network Stats page.
What does staking have to do with minting and burning?
Staking HZN means that you are putting the HZN in there as collateral to Mint/Borrow zUSD. The reason it is called Minting instead of Borrowing is because there is no interest in this process. This is also why zUSD is called “Debt”, because you are technically borrowing this zUSD and you need to return it to be able to take back your HZN. An example of this would be a second mortgage, where you use your house as the collateral and you’re able to borrow some money. To get the house back to be fully under your ownership, then you need to pay back all the money first.
C-Ratio stands for collateralization ratio. This is the amount of collateral needed to borrow/mint a certain amount of zUSD. At 600%, you need $600 worth of HZN to mint $100 of zUSD.
If the price of HZN goes up to double the price, then your HZN is now worth $1200, which means that if you haven’t touched anything else, you are now at a c-ratio of 1200%. At this point, you can Mint again, which would take the extra $600 of HZN and borrow/mint to give you another $100 zUSD for a total of $200 zUSD at 600% c-ratio.
If the price of HZN drops by half back to the previous price so that it is worth $600 again, then you c-ratio has now dropped to 300%. To get back to 600% c-ratio, you need to “Burn”/repay $100 of zUSD so you are back at $100 zUSD of debt.
So the final conclusion is if you hold the zUSD that you mint and don’t do anything with it (trading it away or using it to invest in something else), you will have all the zUSD needed to “burn”/repay your zUSD debt and take out your collateral of HZN.
*Please note that the Target C-Ratio is subject to change based on community feedback. For the most up to date Target C-Ratio, visit the Network Stats page.
Why is there a timer blocking me from burning my zUSD?
There is a 24 hour period between minting and burning zUSD. This is necessary to prevent oracle front-running attacks.
When I stake HZN, and there is the possibility of liquidation, to what degree is my position "leveraged"? I still have my balance of HZN. The threat of liquidation implies that it is leveraged, but this scenario does not seem to entail it?
Liquidation in Horizon Protocol is not the same as liquidation of a leveraged or margin position. Your position in Horizon Protocol is not leveraged, you are actually over-collateralizing a debt position at a 600% ratio to back the creation of synthetic assets. Liquidation occurs when you lack sufficient backing of those synthetic assets. Please refer to the liquidation section.
*Please note that the Target C-Ratio is subject to change based on community feedback. For the most up to date Target C-Ratio, visit the Network Stats page.
Managing C-Ratio
What is C-Ratio?
Collateralization Ratio or C-Ratio is the ratio between your collateral and your debt. Horizon Protocol currently has a target C-Ratio of 600% meaning you need $6 worth of HZN staked to mint $1 zUSD to have a $1 debt. The purpose of the C-Ratio is to ensure that the synthetics produced by Horizon Protocol are sufficiently backed during price fluctuations.
*Please note that the Target C-Ratio is subject to change based on community feedback. For the most up to date Target C-Ratio, visit the Network Stats page.
What happens if my C-Ratio drops below 600%?
If your C-Ratio drops below 600% you will not be able to claim rewards. You will continue to gain rewards but will need to restore your C-Ratio to 600% by burning zUSD or adding more HZN in order to claim rewards. If you do not claim your rewards after a week, your rewards will be forfeited and redistributed to the following week's reward pool.
*Please note that the Target C-Ratio is subject to change based on community feedback. For the most up to date Target C-Ratio, visit the Network Stats page.
How do I know how much zUSD to burn in order to rebalance my C-Ratio to 600%?
Horizon Protocol has preset strategies to help you manage your C-Ratio. Simply clicking the “Aggressive - 600%” preset strategy will automatically calculate how much zUSD you need to burn to return to 600%. You may also manually input how much zUSD you want to burn if you want to maintain a different C-Ratio.
*Please note that the Target C-Ratio is subject to change based on community feedback. For the most up to date Target C-Ratio, visit the Network Stats page.
When exactly am I in the liquidation zone?
If your C-Ratio goes under 200% - you will be automatically flagged for liquidation. Horizon Protocol has a 3-day grace period to allow you to restore your C-Ratio and clear your liquidation flag before your account becomes available for liquidation. You will need to restore your C-Ratio back to 600% before you're able to clear your liquidation flag.
WARNING: Clearing your liquidation flag requires a blockchain transaction and is NOT automatic. Learn more about liquidation here.
*Please note that the Liquidation C-Ratio and Target C-Ratio are subject to change based on community feedback. For the most up to date figures, visit the Network Stats page.
When I burn zUSD, do I also burn my HZN?
No, you never lose HZN when burning zUSD. If your C-Ratio is under 600%, burning zUSD just reduces your debt and increases your C-Ratio. Once your C-Ratio is above 600% you will begin to unstake your HZN when burning zUSD. Reducing your debt to 0 would unstake all of your HZN. Unstaked HZN will become 'transferable' HZN, which is freely usable HZN.
*Please note that the Target C-Ratio is subject to change based on community feedback. For the most up to date Target C-Ratio, visit the Network Stats page.
How come no transferable HZN is showing up when I burn zUSD?
There are 2 reasons this can occur:
You are under 600% C-Ratio, therefore no HZN will actually become unstaked until you burn zUSD while over 600% C-Ratio.
All escrowed HZN you have used to stake must be first unstaked before un-escrowed HZN begins to unstake and become transferable.
*Please note that the Target C-Ratio is subject to change based on community feedback. For the most up to date Target C-Ratio, visit the Network Stats page.
Rewards
How are my rewards calculated for staking HZN in Horizon Protocol?
Your rewards are calculated based on the proportion of your personal debt against the global debt pool. Your proportion of global debt is calculated based on a snapshot of the network taken every Friday around 17:00 UTC.
Your Weekly Rewards = Personal debt/Global debt * Weekly Rewards
How do I maximize rewards?
To maximize rewards you want to hold more debt and mint with all of your HZN (aggressive 600% strategy). Any price drop from the point of minting at 600% will result in you not being able to claim rewards. You have 1 week, until the next week’s reward period starts, to make sure your C-Ratio is at least 600% and claim your rewards or they will be forfeited and returned to the following week’s reward pool for others to earn.
DANGER:
Maximizing rewards is risky and requires more active management. Do not take on risk that you are not comfortable with.
*Please note that the Target C-Ratio is subject to change based on community feedback. For the most up to date Target C-Ratio, visit the Network Stats page.
How long do I have to claim my rewards?
You have until the next reward period to claim your rewards (7 days from when rewards are claimable). Unclaimed rewards will be redistributed into next week’s reward pool. You can see how long you have left to claim by checking the bottom right of the screen where you will see a timer until the next reward claim period.
Will I still gain rewards if I don’t claim this week’s rewards?
Yes, you will continue to gain rewards every week based on how much debt you hold. Any rewards you don’t claim each week will be forfeited and returned back to the reward pool for the following week's reward distribution.
When do my rewards stop calculating?
You will gain rewards as long as you have a debt position at the end of each reward period on Horizon Protocol. If you burn all your zUSD, you will no longer gain rewards.
Why is the reward claim period only 1 week?
The reward claim period coincides with the Horizon Protocol monetary policy, which distributes new tokens on a weekly basis.
In addition, it is very important to maintain the global C-Ratio, therefore, it is critical that stakers are active stakers, re-adjusting their individual C-Ratios at least once a week. Staking in Horizon Protocol is not a stake-and-forget type of system.
Please remember that rewards for the previous week must be claimed before the start of the next reward period or they will be forfeited and redistributed into the next week’s reward pool.
Why can’t there be a setting to auto burn every 3 days, auto claim and auto stake rewards?
Burning, claiming, and staking require transactions on the blockchain that need to be paid for by the user.
Token Information
What is transferable HZN?
Transferable HZN is HZN that is available to be used in your wallet. You can transfer it or sell it, or keep it in your wallet to increase your C-Ratio. Having a good transferable HZN balance will help you maintain your debt position if the HZN price drops and you need more HZN to be staked. Horizon Protocol will automatically migrate your transferable HZN to become staked HZN in this event.
What other forms of collateral will be available to use on Horizon Protocol?
We’ll be looking into other forms of collateral such as BNB and other assets, but currently you can only use HZN as collateral.
What is zUSD and how is it backed?
zUSD is a stablecoin that is pegged to the US Dollar and is minted in Horizon Protocol when staking HZN as collateral. More collateral options will be available in the future.
What can I do with zUSD?
The main purpose of zUSD is to use it to trade for other zAssets on Horizon Protocol. These zAssets are an array of synthetic assets representing the crypto and real economy (i.e. zBTC, zETH, zAPPL, zTSLA, etc.)
Additionally, for staking purposes, you can trade it on Wombat Exchange or compound your HZN staking rewards by supplying liquidity to the zUSD/USDC LP at Wombat Exchange and staking the LP to collect rewards.
Where do zUSDs come from?
zUSDs are always minted (and burned) at a value of $1.00 and are backed by the HZN you ‘stake’ into Horizon Protocol.
How can I see zUSD in my wallet?
Add the zUSD token address: 0xf0186490b18cb74619816cfc7feb51cdbe4ae7b9 to your wallet.
Exchange Trading
How often are the prices updated?
Each zAsset has two variables that will trigger a price refresh. A variable based on a period of time (e.g. every 1 hour) called a heartbeat. Another variable based on price variance (e.g. 0.2%) called variance. If either of these conditions are met, the oracle will update the price feed.
These price updates cost money for the oracle and oracles base their heartbeats and variance values based on general usage. This means that more sensitive variables justify a cost increase. This also highlights a tradeoff in decentralized exchanges (DEXs) and centralized exchanges (CEXs). The loss of speed is made up by decentralization, transparency, and ownership of your own assets. This makes a CEX more desirable for high frequency traders but a DEX far more beneficial to a mid to long term trader/investor.
Why are there fee differences between zAssets? For example: zBTC shows 0.10%, while zAPPL shows 0.50%.
Every zAsset has its own oracle price feed and therefore a corresponding heartbeat and price variance threshold. If a zAsset has a price variance threshold of 0.50%, the exchange fee on Horizon Protocol will also be 0.50% in order to disincentivize users from using the variance threshold to front-run the oracle’s price.
I can't find the zAsset that I'm interested in. What should I do?
We always welcome suggestions for new zAssets. Simply reach out to us with your suggestions, and we'll carefully evaluate them to see if they fit our offerings.
Futures Trading
COMING SOON
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