🚀 Wen testnet? NOW!
We’re thrilled to announce that the Hedgehog Protocol is now live on the Sepolia Testnet!
This is your chance to dive in and test it out without putting any of your assets at risk.
Connecting to the Hedgehog Testnet
Please ensure that you are connected to the correct RPC/network. The details are provided below should you wish to manually add this to your wallet or for cross referencing purposes.
Network Name: Hedgehog Testnet
RPC URL: https://sepolia.drpc.org
Chain ID: 11155111
Currency: ETH
Explorer URL: https://sepolia.etherscan.io
Find alternative RPC’s here.
Faucet
To take part testing the Hedgehog protocol you will need to have Sepolia testnet ETH and Lido Staked Wrapped Ethereum wstETH in your wallet.
Sepolia ETH can be obtained from the faucets:
https://cloud.google.com/application/web3/faucet/ethereum/sepolia
If you need more sepoliaETH, fill this form and we’ll send it to you: https://forms.gle/8Zgf3miZn4VQsTD4A
wstETH can be obtained from contract:
https://sepolia.etherscan.io/address/0x68328F45Ca73f26666520b8027aaA30c014D17c6#code
Contract -> Write contract -> Connect to Web3
Claim -> Write
You should now have both Eth & wstETH in your wallet.
Entering the Testnet
Go to https://testnet.thehedgehog.io/app
This is the testnet front-end build, purely for testing purposes.
Connect your wallet to the website, which will prompt you to connect to Sepolia Testnet in case you have not done so using the above details.
BaseFee Token Explained
In the Hedgehog Protocol, the BaseFee token is a derivative minted using the Collateralized Debt Position (CDP) model. Its value is derived from the on-chain logarithmic moving average of gas prices, updated every 50 blocks through our trusted oracles.
This way, the BaseFee derivative market will still allow for several trading opportunities, be it for hedging or speculation purposes, mitigating volatility and potential manipulation attacks.
Once minted, holders of BaseFee can leverage it in several ways:
- Speculate on gas prices
- Hedge against gas during high fluctuations
- Stake to earn as an LP or Stability Pool depositor
How to mint
To start the process, you’ll need to interact with our protocol’s smart contract to initiate a CDP. At a high level it can be described as simple as “putting up wstETH as collateral to create (mint) Basefee tokens.”
- Connect Your Wallet: Log into your wallet. Ensure it contains the wstETH you wish to use as collateral.
- Initiate a CDP: Through our platform’s dashboard, find the option to create a new CDP. You’ll be prompted to specify the amount of wstETH you want to lock up.
Minting Your Basefee Derivative Tokens
Once your CDP is active, you can mint Basefee derivative tokens. The number of tokens you can create depends on the collateral’s value (your wstETH) and the protocol’s current collateralization ratio requirements, which must be >150%.
- Enter the Desired Amount: Input how many Basefee tokens you wish to mint.
- Confirm and Mint: After reviewing the transaction details, including any associated fees, confirm the transaction. Execute the minting to create your Basefee tokens.
Managing Your Position
With your Basefee tokens now in your wallet, you can manage your exposure. Remember, your CDP is an active position you need to monitor.
- Monitoring: Maintain a healthy collateralization ratio of your CDP. If the value of your locked wstETH falls to the amount of Basefee you’ve minted, you might need to add more collateral or reduce your debt to avoid liquidation.
- Liquidation Process: If the collateral falls below 150% OCR, your CDP could be liquidated, meaning some or all of your wstETH could be sold automatically to cover your debt.
Closing Your Position
When you decide it’s time to close your position, you’ll need to return the Basefee tokens you minted, plus any accrued interest or fees, to retrieve your collateral.
- Repaying the Debt: Interact with the CDP through our platform, selecting the option to close the position. You’ll need to submit the equivalent amount of Basefee tokens you initially borrowed, along with the Redemption fee. To complete the transaction, acquire additional BaseFee tokens from V6 or ensure you have an extra account to open a new position.
- Retrieving Your Collateral: After your debt is repaid, you can withdraw your wstETH from the CDP. Your position is now closed, and your tokens are back in your wallet.Closing position automatically returns all available collateral back
Liquidations
Liquidations ensure stability by managing under-collateralized positions. When collateral drops below required levels, the protocol automatically auctions the collateral to cover the debt. Any surplus is returned to the user, while deficits are covered by the protocol’s insurance. Read more about the liquidation process.
Stability Pool
Users can participate in the stability pool by depositing the Basefee derivative token. These tokens are pooled together and serve as a reserve to absorb losses from liquidation events and ensure the overall stability of the protocol.
Users deposit their stable tokens into the stability pool. These users are often incentivized to do so through mechanisms like interest earnings, rewards in $HOG tokens, or fee-sharing from the protocol’s operations.
Trade BFEE
BaseFee tokens are tradeable on the Automated Market Maker (AMM) V60, allowing direct buying and selling of tokens without a traditional order book. This ensures you can trade your BaseFee tokens anytime, providing flexibility in managing your positions. Link to v60 - https://testnet.v60.io/
Feedback
We appreciate your feedback to help us build the best and secure version of our tech and iron out any bugs and issues.
We have a testnet bug report form form available for you to submit your feedback.
You can access this here: https://form.jotform.com/241871638971064
We appreciate you using our testnet and hope you enjoy the experience.
What is Hedgehog?
Hedgehog is building an infrastructure for on-chain native derivatives, starting with Modular Synthetic Blockspace. Focusing on AA wallets, L2 rollups and similar 4337 paymaster use cases for hedging BaseFee.
