In Borrow Mode, your borrowing limit depends on the value of the assets in your Vault:
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
wHYPE (Wrapped Hype) - 45% LTV
USDC (USD Coin) - 90% LTV
USDT (Tether USDt) - 90% LTV
frxUSD (Frax USD) - 90% LTV
SCR (Scroll) - 20% LTV
Platform Tokens:
ETHFI - 20% LTV
eBTC (Ether.fi's staked BTC) - 52% LTV
eUSD (Ether.fi's staked USD) - 80% LTV
weETH (Ether.fi's wrapped eETH) - 55% LTV
beHYPE (Etherfi's wrapped Hype) - 40% 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 Vault 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 Vault 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 | 0x06eFdBFf2a14a7c8E15944D1F4A48F9F95F663A4 | 90% | 95% | 1% |
WeETH | 0x01f0a31698C4d065659b9bdC21B3610292a1c506 | 55% | 75% | 3.5% |
SCR | 0xd29687c813D741E2F938F4aC377128810E217b1b | 20% | 50% | 5% |
LiquidETH | 0xf0bb20865277aBd641a307eCe5Ee04E79073416C | 50% | 70% | 5% |
LiquidBTC | 0x5f46d540b6eD704C3c8789105F30E075AA900726 | 50% | 70% | 5% |
LiquidUSD | 0x08c6F91e2B681FaF5e17227F2a44C307b3C1364C | 80% | 90% | 2% |
EUSD | 0x939778D83b46B456224A33Fb59630B11DEC56663 | 80% | 90% | 2% |
EBTC | 0x657e8C867D8B37dCC18fA4Caead9C45EB088C642 | 52% | 72% | 5% |
WETH | 0x5300000000000000000000000000000000000004 | 55% | 75% | 3.5% |
ETHFI | 0x056A5FA5da84ceb7f93d36e545C5905607D8bD81 | 20% | 50% | 5% |
USDT | 0xf55BEC9cafDbE8730f096Aa55dad6D22d44099Df | 90% | 95% | 1% |
wHYPE | 0xd83E3d560bA6F05094d9D8B3EB8aaEA571D1864E | 45% | 65% | 4% |
beHype | 0xA519AfBc91986c0e7501d7e34968FEE51CD901aC | 40% | 60% | 5% |
frxUSD | 0x397F939C3b91A74C321ea7129396492bA9Cdce82 | 90% | 95% | 1% |
Liquidation Cheat Terms:
LTV (Loan-to-Value)
LTV is the maximum amount you can borrow against your collateral when initially taking out a loan.
Liquidation Threshold
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.
Liquidation Bonus
This is the incentive paid to liquidators who repay bad debt. They receive the collateral plus this bonus percentage.
Example scenarios:
Example 1: USDC Collateral (Partial Liquidation Sufficient)
Initial Position:
Collateral: $10,000 USDC
Borrowed: $9,000 (90% LTV - maximum safe borrow)
After interest accrual, debt grows to $9,520
Liquidation Triggered: Debt ($9,520) exceeds 95% of collateral ($9,500)
Step 1 - 50% Liquidation:
Liquidator repays: $4,760 (50% of $9,520 debt)
Liquidator receives: $4,807.60 USDC ($4,760 + 1% bonus)
Remaining debt: $4,760
Remaining collateral: $5,192.40 USDC
Health Check:
Debt-to-collateral ratio: $4,760 ÷ $5,192.40 = 91.7%
Position is now healthy (below 95% threshold)
No further liquidation needed ✓
Example 2: weETH Collateral (Full Liquidation Required)
Initial Position:
Collateral: $10,000 weETH
Borrowed: $5,500 (55% LTV - maximum safe borrow)
weETH USD market value drops 30%, collateral now worth $7,000
Current debt-to-collateral: $5,500 ÷ $7,000 = 78.6%
Liquidation Triggered: 78.6% exceeds 75% threshold
Step 1 - 50% Liquidation:
Liquidator repays: $2,750 (50% of $5,500 debt)
Liquidator receives: $2,846.25 worth of weETH ($2,750 + 3.5% bonus)
Remaining debt: $2,750
Remaining collateral: $4,153.75 worth of weETH
Health Check:
Debt-to-collateral ratio: $2,750 ÷ $4,153.75 = 66.2%
Position is healthy (below 75% threshold)
No further liquidation needed ✓
Alternative Scenario - Full Liquidation: If weETH price had dropped 35% instead (collateral worth $6,500):
After 50% liquidation:
Remaining debt: $2,750
Remaining collateral: $3,653.75 worth of weETH
Debt-to-collateral: $2,750 ÷ $3,653.75 = 75.3%
Still above 75% threshold → Full liquidation executed
Step 2 - Remaining 50% Liquidation:
Liquidator repays: $2,750
Liquidator receives: $2,846.25 worth of weETH
Position fully closed