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Documentation Index

Fetch the complete documentation index at: https://docs.airway.fi/llms.txt

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A collateralized debt position (CDP) is the core mechanism through which you mint synthetic RWA tokens on Airway. When you open a CDP, you deposit approved cryptocurrency as collateral into a protocol-managed vault. The protocol then mints synthetic RWA tokens proportional to your collateral value, subject to a minimum collateralization ratio. Your deposited collateral stays locked until you return the minted tokens and close the position. This structure ensures every synthetic RWA in circulation is backed by real on-chain value at all times — no fractional reserves, no off-chain guarantees.

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How CDPs work on Airway

1

Deposit collateral

Choose an approved collateral asset and deposit it into a new CDP. The protocol records your deposit on-chain and calculates how many synthetic RWA tokens you are eligible to mint based on the current collateral value and the required collateralization ratio.
2

Mint synthetic RWA tokens

Once your collateral is locked, the protocol mints sRWA tokens directly to your wallet. The number of tokens you receive is proportional to the value of your collateral, always staying within the safe collateralization threshold to protect the protocol’s stability.
3

Monitor your collateralization ratio

After minting, keep an eye on your collateralization ratio. If the value of your collateral drops relative to the minted sRWAs, your ratio decreases. Falling below the minimum threshold exposes your CDP to automatic liquidation. You can top up your collateral at any time to stay safely above the threshold.
4

Repay and close

When you’re ready to retrieve your collateral, repay the sRWA tokens you minted. The protocol burns the returned tokens and releases your locked collateral back to your wallet, closing the CDP.
If your collateralization ratio falls below the required minimum, the protocol will automatically liquidate your CDP to cover the outstanding synthetic RWA debt. Monitor your position regularly and add collateral if market conditions move against you.

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Benefits of Airway’s CDP model

Security and stability Every synthetic RWA in circulation is backed by collateral locked in an on-chain CDP. Because the protocol enforces collateralization ratios automatically, there is no risk of unbacked tokens entering circulation. Decentralized and automated The entire lifecycle — depositing collateral, minting tokens, monitoring ratios, and liquidating undercollateralized positions — runs through smart contracts. No human approval, no off-chain process, and no intermediary is ever involved. Liquidity and flexibility You retain control of your collateral strategy. By opening and closing CDPs on your own terms, you can gain sRWA exposure when you want it and exit cleanly by repaying your position, all while your collateral remains transparently on-chain.
You can open multiple CDPs backed by different collateral assets. This lets you manage exposure and risk across positions independently.

Synthetic RWAs

Understand what synthetic RWA tokens are and what real-world assets they represent.

Peg maintenance

See how liquidations fit into Airway’s broader peg maintenance system.