If the protocol finds that one of its collateral pools does not have enough collateral to meet the collateralization ratio (CR), the protocol opens up the pool for re-collateralization.
Recollateralization allows users to deposit collateral into the pool and in turn receive a discount in ARTHX proportionate to how much collateral they've deposited.
The discount a user receives by re-collateralizing the protocol is based on a bonding curve which gives more rewards to people who participate in re-collateralizing the protocol early on.
If the protocol starts at a 10% collateralization ratio (CR) and has a target of 80% collateralization ratio, then the protocol calculates the distance from the target CR ratio, using this formula
Once the distance is calculated, it is applied to a bonding curve with the following parameters.
This implies that early participants who re-collateralize the protocol will earn a higher discount in ARTHX than those who re-collateralize the protocol later.