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doc(readme): improvement
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peyha committed Oct 21, 2024
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Expand Up @@ -66,9 +66,10 @@ The [`PreLiquidationAddressLib`](./src/libraries/periphery/PreLiquidationAddress

### Potential preLCF manipulation

A pre-liquidation cannot pre-liquidate a proportion of the position's debt greater than `preLCF`, however it's possible to pre-liquidate a fraction of the position while keeping it pre-liquidatable before performing another pre-liquidation.
This manipulation can lead to repaying a proportion of the position's debt higher than `preLCF` and it has been studied in the part 5.2 of [An Empirical Study of DeFi Liquidations:Incentives, Risks, and Instabilities](https://arxiv.org/pdf/2106.06389).
Implementing a `preLCF` linear with the health factor mitigates this.
A pre-liquidation cannot pre-liquidate a proportion of the position's debt greater than `preLCF`, however it's possible to pre-liquidate a proportion of the position while keeping it pre-liquidatable before performing another pre-liquidation.
This manipulation can lead to repaying a proportion of the position's debt higher than `preLCF`.
It has been studied in the part 5.2 of [An Empirical Study of DeFi Liquidations:Incentives, Risks, and Instabilities](https://arxiv.org/pdf/2106.06389), in the case of a constant liquidation close factor.
Implementing a `preLCF` linear with the health factor can help mitigating this manipulation when choosing the right slope.

## Getting started

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