🏦 LiquiFi — DeFi Lending Protocol with AI-Powered Liquidation Engine

A complete DeFi lending and liquidation platform demonstrating all four pillars: lending protocol, liquidation engine, cross-chain workflows, and AI risk scoring.

Built on Scaffold-ETH 2 with UUPS upgradeable smart contracts.

Architecture

┌─────────────────────┐     ┌──────────────────┐     ┌─────────────────┐
│   Next.js Frontend  │────▶│  Smart Contracts  │◀────│  Liquidation Bot│
│   (Dashboard/Admin) │     │  (Hardhat/EVM)    │     │  (TypeScript)   │
└─────────────────────┘     └──────────────────┘     └────────┬────────┘
                                     ▲                         │
                            ┌────────┴────────┐     ┌─────────▼────────┐
                            │  Cross-Chain     │     │  AI Risk Scorer  │
                            │  Liquidator      │     │  (FastAPI/GPT)   │
                            │  (LayerZero)     │     └──────────────────┘
                            └─────────────────┘

Quick Start

Prerequisites

• Node.js >= 20
• Yarn 4.x
• Python 3.10+ (for AI service)

1. Install Dependencies

yarn install

2. Start Local Blockchain

yarn chain

3. Deploy Contracts

yarn deploy

4. Start Frontend

yarn start

Visit http://localhost:3000

5. Start AI Service (optional)

cd packages/ai-service
pip install -r requirements.txt
cp .env.example .env  # Add your OPENAI_API_KEY
python main.py

6. Start Liquidation Bot (optional)

cd packages/backend
cp .env.example .env  # Fill in contract addresses from deploy output
npm install
npm run dev

Smart Contracts

Contract	Description
LendingPool.sol	Core lending pool — deposit WETH, borrow USDC, liquidation
InterestRateModel.sol	Utilization-based jump rate model (2% base, kink at 80%)
PriceOracle.sol	Mock oracle with admin price-setting (Chainlink-compatible)
CrossChainLiquidator.sol	LayerZero cross-chain liquidation with state machine
MockWETH.sol / MockUSDC.sol	Test tokens with public mint

All contracts are UUPS upgradeable with custom errors for gas optimization.

Deployments (Base Sepolia)

Contract	Proxy Address	Implementation Address
LendingPool	0x3f061392F32819C0383817E94603F2Ba0708F26F	0x018c64dF2EB3d174372Db7AC001b8386e73FaAe8
PriceOracle	0x12bf27596485137fabdfBDEc93274F47B1ae243F	0xc6F7a2fD62943D89daeA86C40819c62dC7C14c7b
InterestRateModel	0xf94C11F250De861492CBc9809A772308BEe73a5b	0xca85fFa7d62371B01676880f95707E8f7de71945
CrossChainLiquidator	0x7201a71c2FCd7CC26deEC2bC8B0Cb608541F726c	0x331DC4AeC3dB525C148D4615d26d2AEacdf036b6
MockWETH	0xF184F47393591bf6d046bFd36bD1eDBb7457B4B9	N/A
MockUSDC	0x74a8eb9f2D6d8e098a4FA030a1Eac57B0a6a4106	N/A

Testing Liquidation Scenarios

1. Deploy & seed: Contracts deploy with 5M USDC pool liquidity
2. Deposit: Deposit 10 WETH as collateral via dashboard
3. Borrow: Borrow 14,000 USDC (near max 75% LTV)
4. Trigger: Use Admin Panel to set ETH price to $1,500
5. Health Factor drops: HF = (10 × 1500 × 0.75) / 14000 ≈ 0.803 → LIQUIDATABLE
6. Liquidate: Bot auto-detects, or use Admin Panel manual liquidation

---

@0xJonaseb111