Credit Suite

The Credit Suite is the foundational unit that enables leverage in Gearbox Protocol. It acts as an isolated environment where borrowers interact with DeFi protocols using borrowed funds while ensuring lender safety.

Component Overview

A Credit Suite consists of three tightly coupled smart contracts deployed together:

Credit Manager (Logic Layer)

The Credit Manager is the "brain" of the suite. It maintains the registry of Credit Accounts, connects to the underlying Pool, and calculates account solvency via the Price Oracle.

Key Responsibilities:

Function	Purpose
Debt tracking	Maintains total debt and collateral tokens per account
Pool interaction	Borrows and repays via PoolV3
Quota management	Coordinates with PoolQuotaKeeper for token limits
Health calculation	Computes Health Factors via calcDebtAndCollateral

The Credit Manager is generally not accessed directly by users but by the Facade or Adapters.

Credit Facade (Access Layer)

The Credit Facade is the "face" of the suite. It serves as the primary entry point for users and implements the multicall logic, allowing complex DeFi operations to happen in a single transaction.

Key Responsibilities:

Function	Purpose
Multicall execution	Iterates through user-provided calls, routing to Credit Account
Security checks	Performs collateral check (Health Factor > 1) at transaction end
Permission management	Manages BotList permissions for approved bots
Access control	Enforces minDebt, maxDebt, and forbiddenTokenMask limits

Credit Configurator (Governance Layer)

The Credit Configurator provides a secure interface for Risk Curators (or the DAO) to manage the suite without direct contract upgrades.

Key Responsibilities:

Function	Purpose
Collateral tokens	Adding/removing allowed tokens
Liquidation thresholds	Setting LT per token
Adapters	Configuring protocol integrations
Fees and limits	Adjusting fee parameters

Configuration Parameters

Risk Curators utilize the Credit Configurator to define the risk profile:

Parameter	Description
Liquidation Threshold (LT)	Maximum leverage for a token. LT of 8500 (85%) implies ~6.6x leverage.
Collateral Tokens	Allowed tokens in Credit Accounts. Unlisted tokens value at 0.
Adapters	Whitelisted protocol integrations (e.g., Uniswap, Curve).
Debt Limits	minDebt and maxDebt per account to prevent dust or concentration risk.
Fees	feeLiquidation (to protocol) and liquidationPremium (to liquidator).

Borrowing and Repayment Flow

Borrowing

1. User calls CreditFacade (open account or increase debt)

2. Facade validates request against debt limits

3. Facade instructs Manager to borrow

4. Manager calls Pool.lendCreditAccount(amount, creditAccount)

5. Pool transfers underlying directly to Credit Account

6. Pool updates interest rate based on new utilization

Repayment

1. User calls CreditFacade (close account or decrease debt)

2. Manager calculates principal + interest + quota fees

3. Underlying transfers to Pool (from user or Credit Account)

4. Manager calls Pool.repayCreditAccount

5. Pool burns treasury shares (if loss) or mints treasury shares (if profit)

Health Factor

The Health Factor determines account solvency:

Health Factor = Total Weighted Value / Total Debt

• Total Weighted Value: Sum of (asset value * liquidation threshold) for all collateral

• Total Debt: Principal + accrued interest + quota fees

When Health Factor drops below 1.0, the account becomes liquidatable.

Implementation

For implementation details, see:

• TypeScript/SDK: SDK Credit Accounts

• Solidity: Credit Operations