How to Create a CP Pool

This comprehensive guide walks you through the process of creating a Counterparty (CP) Pool on the Defactor platform, enabling you to launch decentralized investment opportunities with tokenized asset collateral.

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Overview

Creating a CP Pool involves:

1. Accessing the pool creation interface
2. Configuring pool parameters (funding, timeline, returns)
3. Selecting and approving collateral tokens
4. Paying the creation fee
5. Deploying the pool on-chain

Requirements:

• Connected wallet with sufficient USDC for the 200 USDC creation fee
• Tokenized assets to use as collateral (optional but recommended)
• Clear understanding of your pool's investment thesis and terms

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Step 1: Access CP Pool Creation

There are multiple entry points to create a new pool:

Option A: From the Dashboard

1. Navigate to the CP Pools section from the main menu
2. Click the "Create a new pool" button in the top navigation area

Option B: From Empty State

If you haven't created any pools yet:

1. Navigate to My Pools section
2. You'll see an empty state message: "Pools that you have created will be shown here"
3. Click the "Create a new pool" button

Both options open the same pool creation form.

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Step 2: Configure Pool Parameters

The pool creation form is organized into several sections. All fields marked with an asterisk (*) are required.

Basic Information

1. Pool Name *

Enter a clear, descriptive name that identifies your pool's purpose.

Best Practices:

• Keep it concise but informative
• Include the asset type or investment focus
• Examples: "AgroFuture Growth Pool", "Real Estate Development Fund", "Tech Startup Loan Pool"

2. Description

Provide detailed information about your pool:

• Investment thesis – What will the funds be used for?
• Target market – Who is this investment for?
• Risk factors – What are the potential risks?
• Expected outcomes – What results do you anticipate?

Example:

This pool finances sustainable agriculture projects in emerging markets. Funds will be used to purchase equipment and seeds for small farmers, with repayment expected after harvest season. Historical default rate: 2%.

Funding Parameters

3. Pool Soft Cap * and Pool Hard Cap *

Define the minimum and maximum funding targets:

• Soft Cap (Min USDC) – Minimum amount needed for the pool to activate

  • If this amount is not reached by the deadline, the pool fails
  • All investor funds are returned in full

• Hard Cap (Max USDC) – Maximum amount the pool can accept

  • Once reached, no more deposits are accepted
  • Pool can be collected even if deadline hasn't passed

Planning Tips:

• Set Soft Cap at the minimum viable amount for your project
• Set Hard Cap at the optimal funding level
• Consider platform liquidity when setting targets
• Start conservatively if this is your first pool

Example:

• Soft Cap: 1,000 USDC (minimum to proceed)
• Hard Cap: 5,000 USDC (optimal funding)

Timeline Configuration

4. Deadline * and Liquidation Deadline *

Set critical dates for your pool lifecycle:

• Pool Deadline – Last date to accept investor deposits

  • Choose a date that gives adequate time for funding
  • Pool status changes after this date if soft cap not met

• Liquidation Deadline – Final date for repayment

  • By this date, you must deposit Principal + Rewards
  • If minimum APR not met by this date, collateral liquidation begins
  • Should align with your business cycle/project timeline

Planning Tips:

• Pool Deadline: 7-30 days typically (depending on pool size)
• Liquidation Deadline: Must be after Pool Deadline + your project duration
• Build in buffer time for unexpected delays
• Consider seasonal factors if relevant to your business

Example:

• Pool Deadline: December 15, 2025 (30 days to raise funds)
• Liquidation Deadline: June 15, 2026 (6 months for project + repayment)

Returns Configuration

5. Expected APR *, Minimum APR *, and Expected Term *

Define the return structure for investors:

• Expected APR – The target annual percentage rate you plan to deliver

  • This is your goal and attracts investors
  • Should be realistic based on your business model

• Minimum APR – The lowest acceptable return rate

  • Critical threshold that protects investors
  • If you fail to meet this, collateral enters liquidation
  • Typically set 30-50% below Expected APR

• Expected Term – Duration of the investment in months

  • How long until you expect to repay
  • Used to calculate total returns

Formula for Total Repayment:

Total Repayment = Principal × (1 + (APR × Term / 12))

Example Calculation:

• Principal: 5,000 USDC
• Expected APR: 18%
• Minimum APR: 12%
• Expected Term: 6 months

Expected Repayment: 5,000 × (1 + 0.18 × 6/12) = 5,450 USDC
Minimum Acceptable: 5,000 × (1 + 0.12 × 6/12) = 5,300 USDC

If you deposit less than 5,300 USDC by the Liquidation Deadline, collateral liquidation triggers.

Risk Assessment:

• Higher APR attracts more investors but increases your obligation
• Set Minimum APR at a level you're confident you can meet
• Consider your historical performance and market conditions

External Links

6. Website

Add a link to your project or company website:

• Provides credibility and transparency
• Allows investors to research your business
• Include full URL: https://yourproject.com

7. X (Twitter) Handle

Provide your verified Twitter/X handle:

• Format: @yourhandle or just yourhandle
• Helps build trust with potential investors
• Enables community engagement

Visual Identity

8. Pool Image *

Upload an image that represents your pool:

Requirements:

• Format: PNG, JPG, or SVG
• Max size: 10MB
• Recommended: Square aspect ratio (1:1)

Best Practices:

• Use high-quality, professional images
• Avoid copyrighted content
• Consider using your company logo or project visualization
• Ensure image clearly displays at small sizes

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Step 3: Add Collateral

Collateral is the security backing your pool. It protects investors if you fail to meet repayment obligations.

Why Collateral Matters

• Investor Protection – Provides security if you default
• Trust Building – Shows you're committed to repayment
• Risk Mitigation – Reduces investor risk exposure
• Platform Requirement – Many pools require collateral

Collateral Selection Process

Step 3.1: Click "+ Add" Button

Click the + Add button in the Collateral section to open the token selection modal.

Step 3.2: Choose Collateral Tokens

The collateral selection modal displays your available tokenized assets:

Table Columns:

• Checkbox – Select tokens to use as collateral
• Name – Full token name
• Symbol – Token ticker
• Token ID – Unique identifier
• Type – Token standard (ERC20, ERC721, ERC1155)
• Balance – How many tokens you own

Selection Guidelines:

• You can select multiple tokens as collateral
• Total collateral value should reasonably cover the Hard Cap + Expected Rewards
• Consider token liquidity and market value
• Mix of token types (fungible + NFTs) can diversify security

Actions:

• Select tokens – Check boxes next to tokens you want to include
• Add Collateral – Confirm your selection
• Cancel – Exit without adding collateral

Collateral Value Considerations

Example:

• Hard Cap: 5,000 USDC
• Expected Rewards: 450 USDC
• Total Obligation: 5,450 USDC

Your collateral should be worth at least 5,450 USDC (preferably 110-150% to account for market volatility).

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Step 4: Approve USDC

Before creating the pool, you must approve the platform to charge the 200 USDC creation fee.

Fee Information

• Amount: 200 USDC (non-refundable)
• Purpose: Platform fee to cover gas costs and maintain the ecosystem
• Requirement: You must have at least 200 USDC in your wallet

Approval Process

1. Click "Approve USDC" button
2. Your wallet (MetaMask, Rainbow, etc.) opens with an approval request
3. Review the transaction:
   • Spending cap: 200 USDC
   • Spender: CP Pools smart contract
   • Network fee (gas)
4. Confirm approval in your wallet
5. Wait for confirmation (usually 10-30 seconds)

After approval completes:

• ✅ "Approve USDC" button becomes inactive or disappears
• ✅ "Create Pool" button becomes enabled
• The form is now ready for final submission

Step 5: Create the Pool

Once all requirements are met:

• ✅ All required fields filled
• ✅ Collateral tokens selected and approved
• ✅ USDC fee approved
• ✅ Create Pool button is now active (blue)

Final Submission

1. Review all parameters one last time:

   • Pool name and description
   • Funding caps (Soft Cap, Hard Cap)
   • Deadlines (Pool Deadline, Liquidation Deadline)
   • Returns (Expected APR, Minimum APR, Term)
   • Collateral tokens
   • Pool image

2. Click "Create Pool" button

3. Wallet confirmation opens:

   • Transaction type: Create CP Pool
   • Network fee (gas cost)
   • Contract interaction details

4. Confirm transaction in your wallet

5. Wait for blockchain confirmation:

   • Status: "Creating pool..."
   • Transaction processing (30 seconds - 2 minutes)
   • Block confirmation

6. Success notification:

   • ✅ "Pool created successfully!"
   • You'll be redirected to the Pool Details page or My Pools section

Step 6: After Pool Creation

Once your pool is successfully created:

Immediate Status

• Pool Status: Created (green badge)
• Visible to investors: Yes, appears in the Supplied section for all users
• Accepting deposits: Yes, investors can now commit funds
• Your actions available: Monitor deposits, view details, archive (if needed)

Monitoring Your Pool

Navigate to My Pools to see your created pool:

Available information:

• Current utilization rate (deposited / total committed)
• Number of investors
• Time remaining until deadline
• Status updates in real-time

Next Steps

1. Share your pool:

   • Share the pool details page URL with potential investors
   • Promote on your website and social media
   • Use the X handle and website links you provided

2. Monitor funding progress:

   • Check the utilization rate regularly
   • Respond to investor questions
   • Track time remaining until deadline

3. Prepare for collection:

   • Once Soft Cap is reached, you can collect funds
   • Plan your use of funds according to your pool description
   • Prepare for repayment before Liquidation Deadline