# FAQs
### 1. Getting Started
**Q: What is GVNR** **Diamond Hands?**
A: GVNR Diamond Hands is a Bitcoin-native borrowing platform that lets you borrow liquidity (UCD) against your BTC without selling it. It’s fully on-chain, non-custodial, and doesn’t involve wrapping or trusting third parties.
**Q: Do I need to sign up or create an account?**
A: No sign-up required. Just connect your wallet and start - GVNR Diamond Hands is self-custodial and permissionless.
**Q: Who controls my Bitcoin?**
A: You do. Your BTC is deposited into a smart vault - fully governed by your wallet. No one else can move it.
***
### 2. Smart Vault Setup
**Q: What is a smart vault?**
A: A smart vault is a non-custodial Bitcoin address controlled by a smart contract and your connected wallet. It holds your BTC as collateral and manages your loan.
**Q: How do I deposit BTC?**
A: Once your vault is created, you’ll receive a native BTC deposit address. Send Bitcoin directly from your wallet - no wrapping, bridging, or intermediaries.
**Q: Is there a minimum deposit?**
A: No strict minimum, but the amount must be sufficient to mint at least a few UCD while maintaining the required collateral ratio (minimum 150%).
***
### 3. Borrowing UCD
**Q: What is UCD?**
A: UCD (Ultimate Collateral Dollar) is a decentralised, overcollateralised stablecoin minted against your BTC. It’s backed entirely by your Bitcoin in the vault.
**Q: How much UCD can I borrow?**
A: You can borrow up to 66% of your BTC’s value (i.e. a minimum 150% collateral ratio). Example: Deposit $15,000 in BTC → borrow up to $10,000 UCD.
**Q: How quickly do I receive UCD?**
A: Instantly after your BTC deposit confirms. The UCD is minted directly into your connected wallet.
**Q: Can I convert UCD to other stablecoins?**
A: Yes. UCD can be converted to USDT or USDC (on Ethereum) inside the app or bridged for external use.
***
### 4. Loan Options
**Q: What types of loans can I choose?**
A: Currently Diamond Hands offers a fixed term loan option, which does have flexibility if you wanted to extend the loan or borrow more:
* Fixed-Term: 12 months with a fixed rate paid upfront.
**Q: What happens at the end of a fixed term?**
A: You must repay the loan or extend it. If not, the liquidation threshold (LR) begins rising, increasing your risk of liquidation.
***
### 5. Managing Risk
**Q: What is the collateral ratio (CR)?**
A: CR = Value of your BTC / Value of borrowed UCD. The minimum is 150%, but staying at 200%+ is recommended for safety.
**Q: What is the liquidation ratio (LR)?**
A: LR starts at 110%. If your CR falls below that, your BTC will be automatically liquidated.
**Q: Does the LR change over time?**
A: Yes. If you don’t repay on time, the LR increases exponentially - raising your liquidation risk.
**Q: How do I avoid liquidation?**
A: Make sure you do the following:
* Keep your CR well above 150%
* Monitor BTC price (alerts provided)
* Add more BTC collateral
* Repay part of the loan
* Extend or close your loan on time
**Q: Will I get alerts if I’m at risk?**
A: Yes. GVNR Diamond Hands provides alerts and status updates to help you manage your position proactively.
***
### 6. Repaying the Loan
**Q: How do I repay my loan?**
A: Send UCD back to the smart vault from your wallet. You can repay in full or partially.
**Q: What happens after I repay the full amount?**
A: Your BTC collateral becomes unlocked and can be withdrawn from the vault.
**Q: Can I repay early?**
A: Yes. Early repayment is allowed anytime.
***
### 7. Using UCD
**Q: What can I do with UCD?**
A: You can use UCD however you like - swap, spend, invest, or convert to other stablecoins (e.g. USDT/USDR).
**Q: Can I withdraw UCD to external wallets?**
A: Yes. Once minted, UCD lives in your wallet and can be sent anywhere like any ERC-20 token.
***
### 8. Advanced Questions
**Q: Is UCD stable?**
A: Yes. It is overcollateralised by BTC, and the protocol ensures every UCD in circulation is backed by at least 150% BTC value.
**Q: Can I borrow more after opening a loan?**
A: Yes - if your CR allows. The app will show how much additional UCD you can safely mint.
**Q: What if the price of BTC crashes suddenly?**
A: If your CR drops below 110%, your collateral is liquidated automatically. Monitor regularly and keep a safety buffer.
**Q: Are there any tax implications?**
A: Borrowing UCD is not a taxable event in most jurisdictions, as you’re not selling your BTC. Always consult a tax professional for advice.
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