This page walks you through how to borrow on Silo. We will use USDC as collateral to borrow ETH from the USDC Silo as an example.
We currently support the following:
- Limited mobile support
We will gradually support more browsers and fit in useful mobile features.
At this point you should have successfully deposited USDC and be on the ‘Deposit’ page.
Click on ‘Borrow’ on the USDC Silo dashboard.
There are a few key things to note on this page in the main box:
- Health Factor: The further the slider is to the right, the riskier your borrow position is. Once the health factor reaches 0%, your position will be signaled for liquidation.
- Max LTV: This is the maximum amount of ETH you can borrow against your USDC. The percentage is different for every base asset in every silo and can be changed via governance. LTV and LT for the bridge asset ETH is similar across all silos.
- Liquidation Threshold: This is the threshold at which your borrow position becomes under-collateralized and is therefore signaled for liquidation.
- Borrow APY: This is the current interest rate you will pay to lenders. Interest rate changes based on the utilization rate and will constantly accrue debt to your outstanding borrow position.
The boxes in the top right corner shows open deposit and borrow positions. Since you have deposited USDC but are yet to borrow ETH this will be empty.
Since you have already deposited USDC, you can now borrow ETH.
You will note an ‘Available to borrow’ section which indicates the amount of ETH available to borrow in the silo.
As you increase the amount of ETH you choose to borrow, the ‘Health Factor’ bar will shift, indicating how risky your position is. The further to the right, the smaller the change in your borrow-to-collateral ratio required to be liquidated so it is important to keep an eye on this.
Once you have selected the amount of ETH you want to borrow, press the 'Borrow' button and wait for the transaction to be approved.
Once you have successfully borrowed ETH, the dashboard on the right hand side will update to indicate your borrow position, noting the percentage of total borrowing power you have used.
You will also be able to see your current Health Factor. Note that the Health Factor will constantly update based on the value of your borrow position in relation to the value of your collateral. It is important to keep an eye on it to prevent being liquidated.
If you wish to borrow more ETH, input your additional borrow amount.
Note that the Health Factor bar will shift since the increased borrowing will affect your borrow-to-collateral ratio.
If a user has deposited both the base and bridge assets in a silo (for the USDC Silo, this would involve depositing both USDC and ETH), they will be prevented from borrowing any asset from that Silo to prevent interest rate manipulation.
This status is indicated by the above notification. A user must fully withdraw one of the assets before they are allowed to borrow from the silo.