Collateral and Loan to Value
Loan to value (LTV) is your debt divided by your collateral, in dollars. Borrow $400 against $1,000 of collateral and your LTV is 40%. Every pair on Fund has three limits built on it.
The three limits
- Max LTV: the most you can borrow when you open or grow a loan.
- Liquidation threshold: the LTV at which a loan can be liquidated. It sits above the max LTV to give you room.
- Liquidation penalty: the extra share of collateral a liquidator receives for repaying your debt.
These numbers are an example, not Fund's settings.
A pair allows a max LTV of 70% and has a liquidation threshold of 80%.
You deposit 10 SOL at $150, so $1,500 of collateral, and borrow up to $1,050 (70%).
If SOL falls until your $1,050 of debt is 80% of your collateral, the collateral is worth $1,312.50, which is $131.25 per SOL. That is your liquidation price.
Why limits differ per pair
Limits follow risk. A pair between two stablecoins moves little, so it can allow a higher LTV. A pair where the collateral can drop fast needs more room between the max LTV and the liquidation threshold. Liquidity matters too: a liquidator must be able to sell the collateral without moving its price too much.
Limits for each pair
| Pair | Collateral | Debt | Max LTV | Liquidation threshold |
|---|---|---|---|---|
| #1 | SOL | USDC | Set before launch | Set before launch |
| #2 | SOL | USDT | Set before launch | Set before launch |
| #3 | JitoSOL | USDC | Set before launch | Set before launch |
| #4 | JitoSOL | SOL | Set before launch | Set before launch |
| #5 | cbBTC | USDC | Set before launch | Set before launch |
| #6 | cbBTC | USDT | Set before launch | Set before launch |
| #7 | ETH | USDC | Set before launch | Set before launch |
| #8 | ETH | USDT | Set before launch | Set before launch |
| #9 | USDC | USDT | Set before launch | Set before launch |
| #10 | USDT | USDC | Set before launch | Set before launch |
Every limit is published here before borrowing opens and shown live on each pair page.
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