The problem CoreUSD solves

The protocol addresses the need for a decentralized, stable financial ecosystem that allows users to leverage their crypto assets without risking liquidation in volatile markets. By allowing users to deposit LSDs (Liquid Staking Derivatives) like stCore or lsdBTC, the protocol ensures that sufficient liquidity is always available for liquidations. This is especially critical during periods of significant price drops when the risk of liquidation is high. The restaking mechanism not only enhances the security of the protocol but also incentivizes depositors by distributing liquidation bonuses among them. This creates a self-sustaining system that balances the needs of borrowers, lenders, and the overall stability of the protocol

Challenges we ran into

One of the primary challenges was ensuring that the protocol remained secure and robust, even during periods of extreme market volatility. Managing the liquidity thresholds and health factors for users while accounting for the potential rapid devaluation of collateral posed significant technical hurdles. Additionally, implementing a fair and transparent system for distributing liquidation bonuses among vault depositors required careful consideration to ensure that incentives were aligned across the entire ecosystem. Finally, ensuring seamless interaction between the core logic, price oracles, and vaults demanded rigorous testing and optimization to prevent any vulnerabilities that could be exploited during a market downturn