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, 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.