In Borrow Mode, your borrowing limit depends on the value of the assets in your Safe:
Different assets may have different LTV values
The system ensures you maintain a healthy collateral ratio
If collateral values drop significantly, you may need to add more funds or repay some debt
Supported Tokens and their LTV (Loan-to-value)
The following tokens are available for deposits and collateral:
Core Assets:
wETH (Wrapped Ethereum) - 55% LTV
weETH (Ether.fi's wrapped eETH) - 55% LTV
eBTC (Ether.fi's staked BTC) - 52% LTV
USDC (USD Coin) - 90% LTV
USDT (Tether USDt) - 90% LTV
Platform Tokens:
ETHFI - 20% LTV
SCR (Scroll) - 20% LTV
eUSD (Ether.fi's staked USD) - 80% LTV
Ether.fi's Liquid Vaults Tokens:
LiquidETH - 50% LTV
LiquidBTC - 50% LTV
LiquidUSD (Market Neutral USD) - 80% LTV
Understanding Liquidation Risk
What is liquidation?
If your borrowing exceeds your maximum allowed amount (due to collateral value decreases or other factors), the system may liquidate some of your assets to maintain the health of your account.
How to avoid liquidation:
Monitor your borrowing power and total borrowings
Keep a healthy margin between what you've borrowed and your maximum borrowing limit
Add additional collateral or repay some debt if your position approaches risky levels
Ensure you maintain sufficient collateral value for any borrowed funds
What happens during liquidation:
The Debt Manager controls the liquidation process
Specific tokens from your Safe are transferred to the liquidator
50% of your total collateral is liquidated first; if the position is still unhealthy, the rest of the assets are liquidated as well
The liquidator decides what they want. Each asset has a liquidation bonus. A higher bonus means more profit to the liquidator, but they also need to assess whether there is enough liquidity to swap those assets. Higher bonuses are often assigned to riskier or less liquid tokens. So it depends on the liquidator; they determine the priority based on what makes sense for them.
After liquidation: Your Safe remains operational, and you can continue using the remaining assets either as collateral or for Direct Pay mode spending
Cash Collateral Liquidation Thresholds
Here’s a more detailed look at Liquidation Thresholds for each asset type. This will help you understand the point at which liquidation starts and the bonus applied when assets are liquidated.
Asset | Contract Address (Scroll) | LTV | Liquidation Threshold | Liquidation Bonus |
USDC |
| 90% | 95% | 1% |
WeETH |
| 55% | 75% | 3.5% |
SCR |
| 20% | 50% | 5% |
LiquidETH |
| 50% | 70% | 5% |
LiquidBTC |
| 50% | 70% | 5% |
LiquidUSD |
| 80% | 90% | 2% |
EUSD |
| 80% | 90% | 2% |
EBTC |
| 52% | 72% | 5% |
WETH |
| 55% | 75% | 3.5% |
ETHFI |
| 20% | 50% | 5% |
USDT |
| 90% | 95% | 1% |
Liquidation Cheat Terms:
1. LTV (Loan-to-Value) - 90% for USDC
LTV is the maximum amount you can borrow against your collateral when initially taking out a loan.
Example: If you deposit $10,000 worth of USDC as collateral, you can spend up to $9,000 (90% of $10,000) in direct pay mode.
2. Liquidation Threshold - 95% for USDC
This is the point at which your position becomes eligible for liquidation. If your borrowed amount exceeds this percentage of your collateral value, liquidators can step in.
Example: You deposited $10,000 USDC and borrowed $9,000 worth of assets. If market movements cause your debt to grow (through interest) or your collateral value to drop, and your debt reaches $9,500 (95% of collateral), your position can be liquidated. This gives you a 5% buffer between your maximum borrow (90%) and liquidation (95%).
3. Liquidation Bonus - 1% for USDC
This is the incentive paid to liquidators who repay bad debt. They receive the collateral plus this bonus percentage.
Example: Your position gets liquidated with $10,000 USDC collateral and $9,500 debt. A liquidator repays your $9,500 debt and receives $9,595 worth of your USDC collateral ($9,500 + 1% bonus = $9,595). The 1% bonus ($95) compensates them for the gas fees and effort of performing the liquidation.