> For the complete documentation index, see [llms.txt](https://sio2-finance.gitbook.io/en/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://sio2-finance.gitbook.io/en/systems/risk-parameters.md). # Risk Parameters The table below shows the risk parameters for each asset that is currently supported on SiO2 Finance. The table will continue grow as we list more assets to the protocol. | Asset | Collateral | Loan To Value | Liquidation Threshold | Liquidation Bonus | Reserve Factor | | ----- | ---------- | ------------- | --------------------- | ----------------- | -------------- | | USDC | Yes | 80.0% | 85.0% | 2.5% | 15.0% | | BUSD | Yes | 80.0% | 85.0% | 2.5% | 15.0% | | BAI | Yes | 80.0% | 85.0% | 2.5% | 15.0% | | USDT | Yes | 77.5% | 82.5% | 5.0% | 20.0% | | DAI | Yes | 77.5% | 82.5% | 5.0% | 20.0% | | aUSD | Yes | 77.5% | 82.5% | 5.0% | 20.0% | | WETH | Yes | 75.0% | 80.0% | 7.5% | 25.0% | | WBTC | Yes | 70.0% | 77.5% | 7.5% | 25.0% | | DOT | Yes | 65.0% | 75.0% | 10.0% | 25.0% | | BNB | Yes | 65.0% | 75.0% | 10.0% | 25.0% | | WASTR | Yes | 55.0% | 65.0% | 12.5% | 30.0% | | nASTR | Yes | 50.0% | 60.0% | 12.5% | 30.0% | ## FAQ ### What is Loan To Value (aka. LTV)? LTV is defined as the maximum asset (in dollar value) that one can borrow with a specific asset acting as a collateral. ### What is Liquidation Threshold? Liquidation Threshold is the percentage by which a position is defined as collateral deficient. For example, Liquidation Threshold of 80% means that if the borrowed value rises over 80% of the collateral, the position is collateral deficient. Then the asset might be liquidated. For each wallet, the Liquidation Threshold is calculate as the weighted average of the Liquidation Thresholds of the collateral assets and their value. ### What is Reserve Factor? The reserve factor allocates a share of the protocol’s interests to a collector contract from the ecosystem treasury. SiO2 Finance’s solvency risk is covered by the [Safety Module](/en/systems/safety-module.md), with incentives originating from the ecosystem reserve. As such, the Reserve Factor is a risk premium calibrated based on the overall risk of the asset. Stablecoins are the least risky assets with a lower reserve factor while volatile assets hold more risk and have a higher factor. ### How SiO2 Finance decided those risk parameters? These risk parameters are decided based on a range of factors, such as asset liquidity on Astar Network, volatility of the asset, centralization risks, and etc. --- # Agent Instructions This documentation is published with GitBook. GitBook is the documentation platform designed so that both humans and AI agents can read, navigate, and reason over technical content effectively. Learn more at gitbook.com. ## Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter, and the optional `goal` query parameter: ``` GET https://sio2-finance.gitbook.io/en/systems/risk-parameters.md?ask=&goal= ``` `ask` is the immediate question: it should be specific, self-contained, and written in natural language. `goal` is optional and describes the broader end goal you are ultimately trying to accomplish on behalf of the user. GitBook uses it to tailor the answer towards what is most useful for that goal. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.