Borrow
After depositing collateral onto the platform, users are able to take out a loan on other assets.
How to Borrow Assets
From the markets page, select the asset you wish to borrow.
Input the amount of asset you wish to borrow.
Click "borrow" to submit a transaction.
Once the transaction is confirmed, the asset will be borrowed and sent to your wallet.
Max Borrow (Loan-to-Value)
There is an initial max borrow enforced on all loans. This varies depending on the asset borrowed and ensures that the initial loan is not susceptible to immediate liquidation upon initial borrow during volatile market conditions. The set LTV ratios can be found here.
Borrow Limits
Borrowers can only take a loan as a function of the value of their deposited collateral or available liquidity in the market:
1. Health Factor
A user's health factor determines if their overall loan to collateral ratio is safe. A user may not borrow assets if the subsequent loan value causes their health factor to fall below 1
Health Factor2. Collateral Ratio
An asset's collateral ratio represents the maximum borrowing power afforded to borrowers for depositing it as collateral. This numerical value is also known as liquidation threshold
If a user's deposited asset only has a maximum collateral ratio of 75%, it means that for every $1 provided as collateral (in the deposited asset), a maximum $0.75 loan can be taken. This value on initial loan will be less than $0.75 due to the max borrow function to protect users as stated above.
3. Available Supply
If a user is eligible and wishes to take out a $1000 loan in USDC but the market only has $500 available for borrow, there can only be $500 available for loan
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