Liquidations

Maximum LTV Each silo has a maximum LTV, or loan-to-value ratio. LTV is calculated by dividing the user's borrowed amount by the user's collateral amount. LTVs are calculated independently for each silo, meaning a borrower's position in one silo will not impact the LTV in another silo. When a user's LTV exceeds the maximum LTV, their position will be eligible for liquidation.

Liquidations

During liquidations, any user can repay the borrower's debt and receive a portion of their collateral equal to the debt plus a liquidation fee. Each silo has its own liquidation fee set when it is deployed.

The liquidation fee and max LTV can be viewed by calling the liquidationFee() and maxLTV() functions on the silo respectively. They can also be viewed on the UI by clicking on a given silo's overview page. Users can track their LTV on the Dashboard page of the UI, or alternatively check their Health Factor. The Health Factor represents distance from liquidation, which occurs when the Health Factor drops below 1.0. For example, a Health Factor of 1.05 would represent a position that is 5% away from liquidation.