Borrow Limit

The amount you can borrow is tied to the dollar value of supplied assets and liquidity of the assets you wish to borrow. Moreover, each asset has different Loan-to-Value (LTV) ratios, which influences the maximum amount a user can borrow against deposited collateral.

A user is not able to borrow more than the liquidity than is available on the pool.

Loan-to-Value Ratio

Each asset features a Loan-to-Value (LTV) ratio determining how much a user can borrow against the dollar value of the collateral. For example, a user supplying an asset with a 75% LTV, can only borrow up until 75% of value of that value. Information about the LTV per asset can be found on the Markets page.

When a user exceed the LTV ratio, the collateral supplied to borrow against, will start being sold to cover the debt and maintain optimal levels.

Additionally, borrow limits are also constrained by the Health Factor, when the Health Factor is too low borrowing assets becomes restricted. For example if the collateral deposited raises in value you can borrow more as the underlying asset has appreciated and your Health Factor has improved. Learn more about Health Factor.

Borrow Cap

Borrow caps are the highest allowable borrowing limit for an asset. They serve as a protective measure to deter both regular and flash borrowing that could be exploit price vulnerabilities, potentially causing a protocol to become insolvent. The inclusion of a borrow cap is discretionary, with its specific value contingent upon the asset's liquidity and the total volume of borrowed assets in the pool.