Inverse Finance

Frontier FAQ

How much can I borrow?

You can borrow up to a maximum 85% of your deposited collateral, which equates to a 140% collateralization ratio, however some assets have a higher collateralization ratio (meaning less can be borrowed against them).
Over time the collateralization ratio will be reduced so that you can borrow a higher amount vs your deposited collateral, resulting in higher capital efficiency

How do liquidations work?

Please see the liquidation guide and example here

How much of my debt can repaid by external liquidators?

A liquidator can repay up to 100% of your debt to Frontier in one transaction

In a liquidation event, how much of my collateral can I lose?

A liquidator can seize 113% worth of your outstanding debt position as collateral. 100% of the debt + 13% liquidation penalty (or bonus, depending on the way that you look at it)

Which collateral can be seized in a liquidation event?

A liquidator can seize one asset that you have used as collateral

Does Frontier use an oracle to calculate the liquidation price?

Yes, Frontier uses Chainlink oracles to calculate the point at which you become insolvent (your Debt / Credit Limit factor increases above 100%) and the 13% discount applied to the seizing of your collateral

How many blocks does debt / credit Limit ratio need to be above 100% before I am considered insolvent?

The moment that your debt vs credit limit ratio goes above 100% you are considered insolvent by the protocol and your collateral can be seized by external liquidators