Risk parameters

Loan To Value

The maximum amount that can be borrowed for a specific mortgage is determined by the Loan To Value (LTV) ratio. For example, if the LTV is 75%, borrowers will be allowed to borrow 0.75 ETH worth of corresponding currency for every 1 ETH worth of collateral.
For a wallet, the maximum LTV is calculated as the weighted average of LTVs of collateral assets and their value. In particular, for a wallet that deposits the collateral assets that are worth in dollars
C1,,CnC_1, \dots ,C_n
, and their LTVs corresponding to
LTV1,,LTVnLTV_1, \dots , LTV_n
, maximum LTV is
C1×LTV1++Cn×LTVnC1++Cn\frac{C_1 \times LTV_1 + \cdots + C_n \times LTV_n }{C_1+\cdots+C_n}

Liquidation Threshold

The liquidation threshold is the percentage at which a position is defined as undercollateralised. For example, a Liquidation threshold of 80% means that if the value rises above 80% of the collateral, the position is undercollateralised and could be liquidated.
The difference between the Loan To Value and the Liquidation Threshold is a safety cushion for borrowers.
For each wallet, the liquidation threshold is calculated as the weighted average of the liquidation thresholds of the collateral assets and their value. In particular, for a wallet that deposits the collateral assets that are worth in dollars
C1,,CnC_1, \dots ,C_n
, and their liquidation threshold, respectively,
LT1,,LTnLT_1, \dots, LT_n
, the liquidation thresholds of wallet is
C1×LT1++Cn×LTnC1++Cn\frac{C_1 \times LT_1 + \cdots + C_n \times LT_n}{C_1 + \cdots + C_n}

Health Factor

For a wallet, these risk parameters enable the calculation of the health factor:
Hf=C1×LT1++Cn×LTnBH_f = \frac{C_1 \times LT_1+ \cdots + C_n \times LT_n}{B}
where
BB
is total borrows (in dollars),
C1,,CnC_1,\dots,C_n
is the values (in dollars) of collateral assets, and
LT1,,LTnLT_1, \dots, LT_n
is their liquidation threshold, respectively. When
Hf<1H_f < 1
the loan may be liquidated to maintain solvency.

Liquidation penalty

Liquidation penalty is a bonus applied to the price of collateral assets purchased by liquidators as part of the liquidation of a loan that has reached the liquidation threshold.

Reserve Factor

The reserve factor allocates a share of the protocol's interests to a collector contract as reserve for the ecosystem.

Risk Parameters

BSC Lending Pool

Reserve
Collateral
LTV
Threshold
Bonus
Reserve Factor
DAI
Yes
75%
80%
5%
10%
USDC
Yes
80%
85%
5%
10%
USDT
Yes
75%
80%
5%
10%
ETH
Yes
80%
82.5%
5%
10%
BNB
Yes
75%
80%
5%
15%
BTCB
Yes
70%
75%
9%
20%
BUSD
Yes
75%
80%
5%
10%
AAVE
Yes
70%
75%
5%
10%
ADA
Yes
70%
75%
5%
10%
CAKE
Yes
70%
75%
5%
20%
XRP
Yes
70%
75%
5%
20%
DOGE
Yes
55%
60%
8%
20%
DOT
Yes
70%
75%
5%
20%
XVS
Yes
60%
65%
5%
20%
FTM
Yes
75%
80%
5%
20%

FTM Lending Pool

Reserve
Collateral
LTV
Threshold
Bonus
Reserve Factor
DAI
Yes
75%
80%
5%
10%
USDC
Yes
80%
85%
5%
10%
USDT
Yes
75%
80%
5%
10%
ETH
Yes
80%
82.5%
5%
10%
BTC
Yes
70%
75%
9%
20%
FTM
Yes
75%
80%
5%
20%

ETH Lending Pool

Reserve
Collateral
LTV
Threshold
Bonus
Reserve Factor
DAI
Yes
75%
80%
5%
20%
USDC
Yes
80%
85%
5%
20%
USDT
Yes
75%
80%
5%
20%
ETH
Yes
80%
82.5%
5%
20%
BTC
Yes
70%
75%
9%
20%

Price Discovery

The frequency of price updates is determined by the liquidation strategy. We use a margin method, which means that prices are refreshed whenever the deviation exceeds a certain threshold. For the price feed, we rely on Chainlink's decentralized oracles.
Last modified 4mo ago