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Parameters

All factors may change from time to time depending on DAO/circumstances.
Max LTV
Liquidation Threshold
Liquidation penalty
Reserve Factor
The Max LTV expresses the maximum amount of an asset that can be borrowed with a given amount and type of collateral. A Max LTV of 70% for an asset deposited as collateral would mean that up to 70% of the asset's value in another asset may be borrowed. For example, if you supply 1 ETH worth 1000 USDT as collateral with an Max LTV of 70%, you can borrow up to 700 USDT.
The liquidation threshold for an individual loan is the point at which the value of the loan is no longer adequately covered by the value of the collateral. For example, if you supply 1 ETH worth 1000 USDT as collateral with a liquidation threshold of 80%, the collateralization factor is 70%, you borrow up to 700 USDT, and the value of 1 ETH drops by more than 20% to 800 USDT, your position may be liquidated.
When the collateral is liquidated, the borrower must pay a fee to the protocol, called the liquidation penalty.
The liquidation happens automatically, LineaBank takes the liquidation penalty as a fee on the posted collateral, and repays the loan on behalf of the borrower.
The Reserve Factor is the amount that LineaBank receives from the Borrower.
For example, if a loan incurs $100 in interest, and the Reserve Factor is 80%, $80 goes to LineaBank and $20 goes to the Supplier.
LineaBank then distributes 80% of that $80, $64, to $LAB stakers on a weekly basis and reserves the remaining $16 in the protocol treasury.
The treasury, and the protocol revenue distributed to users, will play a huge role in the $LAB buyback and burning mechanism.
Asset
Max LTV
Liquidation Threshold
Liquidation penalty
Reserve Factor
ETH
75%
75%
15%
20%
USDC
80%
80%
15%
20%
WBTC
65%
65%
15%
20%
Utilization Rate
The utilization rate indicates how much of the lending pool's capital has been loaned out. Based on Optimal, the lower it is, the lower the interest rate for borrowers, the lower the interest rate for suppliers, and vice versa.
So the more a borrower borrows from the pool, the higher the interest rate. Borrowers can withdraw collateral by repaying their position (borrowed tokens) and the interest on the borrowed tokens.
Asset
Optimal
Slope 1
Slope 2
ETH
65%
10%
100%
USDC
65%
10%
100%
WBTC
60%
12%
110%