Providing Collateral

Borrowing against your crypto assets!

Supplying Assets

In order to become eligible to borrow from LEND, users have to first supply tokens to the protocol AND set them to be used as collateral. Borrowers can supply a range of supported assets and they can be found on the 'Supply Market' section within the main LEND dashboard. Borrowers will be able to chose which tokens they want to supply to fund their loan.

The tokens supplied to the protocol DO NOT need to match the tokens you wish to create a borrow balance for. Example: You can supply $USDC and borrow $BTC

By supplying tokens, they will receive a tToken version of the supplied asset. These tTokens represent their share of the pool and essentially act as a receipt. Once supplied these tTokens will start to earn interest on their assets and earn $LEND! You can read about how much APY will be earned by supplying tokens by reading this section:

pageHow is APY calculated?

Allocating Collateral

Before a user borrows using a Lending Pool, they are required to provide collateral in excess to the borrowed amount. This is to cover their loan and to serve as first-loss capital to the Pools, aligning their interests with Lenders. Once assets have been supplied users have the ability to mark which assets they would like to be used as collateral for any future borrowing from the protocol. This is simple and easy process, available for all tokens listed on the supply market (except $LEND, the ability to use this as collateral will come later).

Allocate collateral with this toggle!

The ability to assign which tokens to use as collateral is easily accessible via the toggle available on the dashboard.

• Allocating collateral opens the ability to create a borrow balance from the protocol.

• The dashboard will always display a live 'Borrow Limit' which will visualise how much in $ value your account can safely borrow. For ease it also displays this as a %.

• Collateral can be retrieved in full or partially returned by repaying all or some of the outstanding borrow balance.

If you have an outstanding borrow balance you will not be able to retrieve any of the collateral being used by the loan until some of the borrow balance has been repaid.

Setting assets to be used as collateral provides the LEND platform with the ability to auction this off should a borrow balance become unhealthy and subject to liquidation.

To learn about creating a borrow balance, understanding repayment fees on a borrow make sure you read about it here:

pageBorrowing & Repaying Tokens

Collateral Factor

Each unique supplied asset has a different 'collateral factor', this simply refers to how much can be borrowed against the supplied token. The collateral factor is controlled via the TENtroller. Collateral factor could also be thought of as a unique loan-to-value metric for each token supplied.

Example: If $BUSD has a collateral factor of 75% you would be able to borrow $0.75 for every 1 $BUSD supplied.

The Collateral Factor will vary depending on a range of metrics. The collateral factor of each token can be viewed easily via the market tab on the LEND dashboard. You can get familiar with the dashboard here!