Spree Consumer Credit
Spree Consumer Credit enables individuals to leverage their digital assets without selling them. By depositing BTC, ETH, SOL or other supported tokens as collateral, users can mint Spree Points (SP) for everyday spending—ranging from online shopping to in-store purchases. Similar to Aave’s over-collateralized approach, Spree Consumer Credit provides a seamless way to unlock liquidity and pay for real-world goods while preserving long-term exposure to the underlying crypto assets.
Key Benefits:
No Forced Sale of Crypto: Avoid taxable events and potential upside loss.
Flexible, Perpetual Line of Credit: Borrow up to a collateral-based limit with no set maturity date.
SP Rewards Offset Costs: Earn merchant-issued SP for each purchase, which can be used to repay interest or extend loan duration.
Secure & Over-Collateralized: Robust liquidation mechanisms protect the protocol from under-collateralized positions.
How It Works
1. Deposit Assets as Collateral
Collateralization
Users deposit SOL or other accepted tokens (e.g., USDC, USDT, cbBTC, JitSOL, etc) into the Spree Credit smart contract.
The protocol enforces a Collateral Ratio (CR) to ensure positions remain secure (e.g., 150%—meaning $150 of collateral backs $100 in borrowing).
Indefinite Time Horizon
Once collateral is locked, users can maintain the borrowing position indefinitely—no fixed maturity date—provided they keep their collateral above the liquidation threshold.
2. Mint Spree Points (SP)
Borrowing Limit
Based on the posted collateral and the protocol’s CR, a user can mint up to a maximum amount of SP.
Instant Liquidity
Minted SP appear in the user’s wallet, ready to spend across millions of merchants integrated with Spree’s commerce network.
3. Spend Without Selling
No Taxable Event
Because the user borrows SP instead of selling their crypto, they avoid realizing potential gains (depending on local tax regulations).
Real-World Purchases
Use SP to buy goods or services from Spree-enabled merchants.
Enjoy loyalty rewards—some merchants may provide additional SP as “cash-back” or perks.
4. Repay & Reclaim Collateral
Redeem Collateral
At any time, the user can repay the borrowed SP (plus any accrued interest) to reclaim their original crypto collateral.
Liquidation Risk
If the collateral’s market value falls too much (causing the Loan-to-Value ratio to exceed protocol limits), a liquidation mechanism can kick in, selling part (or all) of the collateral to cover the debt.
5. Synthetic Credit Line & Rewards
A unique feature of Spree Consumer Credit is the ability to recycle merchant-issued SP back into the loan structure:
1. Repay Borrowed SP
Allocate received merchant SP to repay part of the loan principal—gradually reducing the outstanding debt.
2. Unlock Collateral
Once principal is reduced, the user can withdraw a portion of their collateral if desired, effectively lowering their borrow amount in tandem.
3. Extend the Loan Duration
Using merchant SP rewards to pay off accumulated interest can keep the loan open longer at minimal or zero net interest cost—turning it into a “0% APR” structure as long as SP rewards offset interest.
6. Synthetic 0 % APR via Merchant-Funded Rewards
Spree Credit lets borrowers convert merchant “cash-back” into an on-chain interest subsidy, turning a standard over-collateralised loan into effective 0% financing on 2m+ merchants on Bookit.com.
1. Borrow & Spend
User deposits collateral (e.g., SOL) and mints SP.
SP is spent through Bookit.com on any of the 2M + merchants integrated with Spree.
2. Earn Merchant-Funded SP
Each purchase returns SP rewards (1–20 % of ticket size) paid out of the merchant margin—no cost to the protocol or borrower.
3. Offset Interest in Real Time
Rewards flow back into the same debt position.
If daily reward accrual ≥ daily interest, the effective borrow rate becomes 0 % APR for that period.
Excess rewards may be applied to principal, shrinking the loan and freeing collateral.
4. Maintain the Loop
Keep collateral ≥ liquidation threshold through paying off the loan or leveraging Bonus Rewards
Continue normal spend behaviour to refresh the reward stream and preserve 0 % status.
Result: holders obtain short-term purchasing power without selling their assets, while merchant-funded SP subsidises the cost of capital—delivering a synthetic, self-recharging 0 % financing line tied directly to real-world commerce volume.
Risk & Reward
Upside Retention
Consumers keep ownership of volatile assets that may appreciate over time.
Volatility Risks
A sudden drop in collateral value can trigger liquidation. Users must monitor collateral health ratios or set up alerts.
Flexible Repayment
Interest rates accrue over time, but with frequent spending, merchant SP rewards can significantly offset interest obligations.
Why Spree Consumer Credit?
DeFi with Real-World Utility: Instead of just borrowing stablecoins for on-chain yields, users borrow SP to spend on actual goods and services.
Infinite Loop of Rewards: The more you spend with SP, the more SP you can earn as loyalty points, which in turn can help keep borrowing costs down.
Secure & Over-Collateralized: Built on Solana, Spree benefits from high throughput, low fees, and proven smart contract safety.
Integrated with Spree’s Merchant Network: SP is accepted across a wide merchant base, bridging the gap between crypto holders and real-world commerce.
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