> For the complete documentation index, see [llms.txt](https://arganodex.gitbook.io/argano-ecosystem/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://arganodex.gitbook.io/argano-ecosystem/algorithmic-functionality/redeeming-agobtc-and-agousd.md).

# Redeeming AGOBTC & AGOUSD

Redeeming explanation

The process of redeeming implies returning the collateralized tokens AGOUSD / AGOBTC back to the protocol and, in return, receiving back the user's collateral assets and the required amount of share tokens CNBTC / CNUSD, which are required to reach desired equality. This in turn means that with every $1 value, users will receive part of the collateral together with the part of share tokens.

The redeeming formula works based on the Effective Collateral Ratio (`ECR`) and applies for both algorithmic tokens:

$$
Collateral(WBTC/USDT) *{Amount}= \cfrac{AGOBTC/AGOUSD*{Amount}×ECR}{Collateral(WBTC/USDT) \_{Price}}
$$

$$
Share (CNBTC/CNUSD)*{Amount}= \cfrac{AGOBTC/AGOUSD*{Amount}×(1-ECR)}{Share (CNBTC/CNUSD)\_{Price}}
$$

Now, let's take a look at the following situations, using different input data.

### Set - up №1:

* ECR - 100%
* USDT price - $1.00

$$
USDT\_{Amount}= \cfrac{100\_{AGOUSD}}{$1} = 100\_{USDT}
$$

### Set - up №2:

* ECR  is equal to 80%
* WBTC price - $59,000.00
* CNBTC - $18,000.00
* The user wants to redeem 1 AGOBTC

$$
WBTC\_{Amount}= \cfrac{1\_{AGOBTC}×\overbrace{80%}^{\text{ECR}}}{\underbrace{59000}*{\text{WBTC price}}} = 0.00001356*{WBTC}
$$

$$
CNBTC\_{Amount}= \cfrac{1\_{AGOBTC}×(1-\overbrace{80%}^{\text{ECR}})}{\underbrace{18000}*{\text{CNBTC price}}} = 0.00001111*{CNBTC}
$$

Summarizing all the above, when the user redeems 1 AGOBTC, he receives 0.00001356 WBTC and 0.00001111 at the WBTC price - $59,000.00 and ECR level of 80%.

$$
\text{Total Value} =(0.00001356\_{WBTC}×59000) +(0.00001111\_{CNBTC}×18000)= 0.80004+0.19998=1.00002
$$

{% hint style="info" %}
The basic redeeming fee is configured to 0.4% but can be decreased to 0.2% by holding the AGO governance token on the wallet.
{% endhint %}