> For the complete documentation index, see [llms.txt](https://kresko.gitbook.io/kresko-docs/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://kresko.gitbook.io/kresko-docs/fundamentals/cdps/scdp.md).

# SCDP

Shared Collateralized Debt Position

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This documentation is a work in progress!
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The shared collateralized debt position (SCDP) allows different accounts to deposit [Collateral Assets ](/kresko-docs/fundamentals/collateral-assets.md)into a single position. These pooled [deposits](/kresko-docs/fundamentals/cdps/scdp/deposits.md) are utilized as liquidity for zero-slippage [swaps](/kresko-docs/fundamentals/cdps/scdp/swaps.md) where [Kresko Assets ](/kresko-docs/fundamentals/kresko-assets.md)can be exchanged to an equal value of another Kresko Asset.

## Use Cases

For example, Kresko Assets borrowed from an [ICDP](/kresko-docs/fundamentals/cdps/icdp.md) can be swapped to another Kresko Asset, translating to a short position on the borrowed asset. Conversely, using [KISS](/kresko-docs/fundamentals/kiss.md) or [synth wraps](/kresko-docs/fundamentals/synth-wrap.md) to obtain Kresko Assets for a swap allows any Kresko Asset to be acquired without borrowing.

## Reasoning

The shared position concentrates the liquidity of Kresko Assets while liquidity providers and traders avoid the downsides of a regular AMM, such as slippage, impermanent loss and fragmented liquidity. 

## Participants

Accounts can participate in the SCDP as a depositor, trader and/or a [liquidator](/kresko-docs/fundamentals/cdps/scdp/liquidations.md).

<figure><img src="https://lh7-us.googleusercontent.com/jV7CHiTTUL1H3N8FSbR-t8vWIXbVa19dd00GuXi4MUJR-quSSh0YADT8BHRY74L9HUfXr9VsCxNBOleJlMxNqyhzhm38sDFHWpzYbfUljd19WaQIuulL4pPSDD7MzwAU_skAFWejkLWoZIkoY-kqxbI" alt="" width="563"><figcaption><p>Shared Collateralized Debt Position </p></figcaption></figure>

## Risk

Most notable risk to the SCDP is depositors being unable to fully manage their risk, leaving them to rely on the protocols risk mitigation parameters. Since **depositors** **are the counterparty for each swap**, they bear the risk of adverse selection and rapid changes to the [debt composition](/kresko-docs/fundamentals/cdps.md#total-debt-value) which might lead into liquidations. Because of this, the protocol is committed to align the incentives as such.

To mitigate risk of the depositors, the [MCR](/kresko-docs/fundamentals/cdps.md#minimum-collateralization-ratio) used for the SCDP has a large difference to the [liquidation threshold](/kresko-docs/fundamentals/cdps.md#liquidation-threshold). As collateral is utilized by arbitrary trading and [depositors](/kresko-docs/fundamentals/cdps/scdp/deposits.md) can [withdraw](/kresko-docs/fundamentals/cdps/scdp/deposits.md#withdrawals) any non-utilized collateral, it shouldn’t be a concern to hit the MCR. \ <br>