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Lending & Borrowing

Under what circumstances will liquidation occur?

Liquidation occurs when a borrower’s risk factor falls above 1 due to insufficient deposit/collateral value which is unable to cover his/her loan value.
This could happen when the value of deposited collateral decreases or the value of borrowed debt increases relative to each other.
You may calculate your risk factor by referring to Liquidation Calculations.

How can I avoid being liquidated?

To avoid being liquidated, it’s important to be mindful of your risk factor and always keep enough margin in your account. If it goes higher than expected, you can reduce your risk factor by increasing the collateral assets or repaying your loan.
You can also subscribe to notifications(coming soon) within our APP to track and receive alarms directly from Email/SMS when your deposits are at risk.

Why should I withdraw all my deposits before borrowing?

In Aries Markets, our protocol design prevents users from depositing and borrowing the same assets (commonly called looping or folding). This is a common way of boosting deposited value to earn more liquidity mining incentives, and does not reflect “true” usage of the protocol. This activity could be highly hazardous to users; as they may not be able to repay your loan in time during volatile movements.

Why can’t I input the amount I would like to borrow?

The maximum amount you can borrow depends on your deposited value and the available liquidity. If you want to borrow an asset, make sure:
  • You have no existing deposit;
  • You have sufficient margin / borrow power in your account;
  • There is enough liquidity in the market.

Is there a minimum or maximum amount of a deposit?

There are no minimum deposit limits on Aries Markets. However, during our initial launch phase, new asset listings or assets that fall under specific tiers in our asset tiering system may have deposit limits.