Kamino-lending-liquidator-bot

Table of contents

• Kamino-lending-liquidator-bot
  • Overview
  • Basic Usage
    • Node
    • Docker
  • FAQ
    • Enabling wallet rebalancing
    • Rebalance padding
    • Target specific markets
    • Tweak throttling
  • Support

Overview

The Kamino-lending liquidator bot identifies and liquidates overexposed obligations. Kamino-lending awards liquidators a 5-20% bonus on each liquidation. Visit Kamino-lending documentation for the parameters on each asset. This repo is intended as a starting point for the Kamino-lending community to build their liquidator bots.

Basic Usage

A funded file system wallet is required to liquidate obligations. Users may choose to enable auto rebalancing or manually rebalance after tokens have been used to repay a debt.

A private RPC is required as public RPCs have strict rate limiting and response size restrictions. You can get a private rpc set up in minutes through Figment which provides a free tier of 3m request/month and the PRO tier costs only $50/month.

Node

1. Install packages by running npm i.
2. Create a .env file in the root of the project directory.
3. Copy and paste the following and update the values to reflect your environment.

APP=production
RPC_ENDPOINT=https://YOUR-RPC-URL
SECRET_PATH=/path/to/wallet/id.json
MARKETS=4UpD2fh7xH3VP9QQaXtsS1YY3bxzWhtfpks7FatyKvdY # OPTIONAL
TARGETS=USDC:100 USDT:5 SOL:0.5 SLND:100 ETH:0.05 BTC:0.001 mSOL:0.1 stSOL:0.1 RAY:1 SRM:1 FTT:.125 ORCA:1 # OPTIONAL
KAMINO_TOKENS=true

4. Now run npm run build && npm start

Docker

Set your private RPC in docker-compose.yaml

- RPC_ENDPOINT=<YOUR PRIVATE RPC ENDPOINT>

1. Install docker engine and docker-compose

2. Update file system wallet path in docker-compose.yaml.

secrets:
  keypair:
    file: <PATH TO KEYPAIR WALLET THAT WILL BE LIQUIDATING UNDERWATER OBLIGATIONS>

3. Build and run liquidator

docker-compose up --build

P.S. To run liquidator in background:

docker-compose up --build -d

FAQ

Enabling wallet rebalancing

The auto rebalancing has to be explicitly enabled by specifying the token distribution in docker-compose.yaml. Under the hood, the liquidator uses Jupiter to rebalance against the USDC<>token pair. Make sure your wallet has an excess amount of USDC to cover liquidation of USDC positions along with rebalancing of other assets. A rule of thumb of USDC to hold is (targeted USDC amount * 1.3). Note that since USDC is base token, we will only use USDC to purchase other tokens when required but not use other tokens to purchase USDC when USDC holdings is below target value. The rebalancer neglets the USDC target value and its only listed to ensure users deposit USDC. Nonetheless, do not remove USDC from the target distribution.

Steps:

1. In docker-compose.yaml, uncomment the following line

# - TARGETS=USDC:100 USDT:5 scnSOL:0.5 SOL:0.5

2. Specify the distribution you would like. The following format is required:

<TokenA>:<amount> <TokenB>:<amount> ... <TokenZ>:<amount>

The amount is in token units e.g SOL:1 means 1 SOL and ETH:2 mean 2 ETH. The distribution is set using token units instead of token price to keep rebalancer independent of price fluctuations but only after a liquidation transaction has been executed.

Example: Distribution where we expect the liquidator wallet to be holding 500 USDT, 10 SOL and 1 ETH. As mentioned above, the USDC target is ignored as it is the base token we trade to/from.

# - TARGETS=USDC:1000 USDT:500 SOL:10 ETH:1

Rebalance padding

The env variable REBALANCE_PADDING is introduced in docker-compose.yaml to avoid unnecessary padding. If the targeted SOL amount is 10 and REBALANCE_PADDING is 0.2, we will only swap USDC for SOL when SOL holding is under 8 SOL = (10 SOL (1 - REBALANCE_PADDING )) and only sell when SOL holding is over 12 SOL = (10 SOL (1 + REBALANCE_PADDING)). Default padding is set to 0.2

Target specific markets

BY default the liquidator runs against all kamino-lending created pools e.g main, TURBO SOL, dog, etc... If you want to target specific markets, you just need to specify the MARKETS param in docker-compose.yaml separated by commas. The following definition will configures the liquidator to only run against the main and coin98 pools.

MARKET=4UpD2fh7xH3VP9QQaXtsS1YY3bxzWhtfpks7FatyKvdY,7tiNvRHSjYDfc6usrWnSNPyuN68xQfKs1ZG2oqtR5F46

Tweak throttling

If you are getting rate limited by your RPC provider, you can use the following env variable to avoid getting rate limited. If you have a custom RPC provider, you will be fine without any throttling.

  - THROTTLE=1000 # Throttle not avoid rate limiting. In milliseconds

Support

PRs to improve this repo are welcomed! If you need help setting up your liquidator bot, feel free to post your questions in the #dev-support channel within [Kamino-lending's discord server](TODO: Add here ).