YieldBlox
yieldblox.financeGitHubDiscord
  • YieldBlox Documentation
  • User Docs
    • General
    • Lending & Borrowing
      • Lending
      • Borrowing
      • Interest Rates
      • Health Factors
      • Liquidations
      • Default Protection
    • Escrowing
    • Governance
    • YBX Tokens
      • YBX Tokenomics
      • Game Theory of YBX
    • Why Stellar?
  • Technical Docs
    • YieldBlox Protocol Assets
    • User Positions
    • Interest Rates
    • Underlying Asset Data
    • Accrued Interest Tracking
    • YBX Issuance
    • Protocol Accounts
    • Smart Contracts/Architecture
      • Mint Contract
      • Burn Contract
      • Repay Contract
      • Liquidate Contract
      • Rate Contract
      • Claim Contract
      • Escrow Contract
      • Governance Contract
      • Vote Contract
    • Math
    • YieldBlox Turrets
  • Resources
    • Technical Resources
    • Community Resources
    • Protocol Assets
Powered by GitBook
On this page
  • What's a health factor?
  • How can I increase my health factor?

Was this helpful?

  1. User Docs
  2. Lending & Borrowing

Health Factors

PreviousInterest RatesNextLiquidations

Last updated 3 years ago

Was this helpful?

What's a health factor?

An account's health factor is a measure of the account's collateralization levels. It is based on the account's total liability value, collateral value, and collateral liquidation factors.

To originate a loan, a user must ensure their health factor will be above 1.10 after the loan has been originated. If a user account's health factor falls below 1.00, their positions can be liquidated until their health factor reaches 1.02. See a rough health factor scale below:

Where:

Liquidation factors are assigned to supported assets by the protocol, and they govern the point at which an account's positions can be liquidated.

How can I increase my health factor?

An accounts health factor is calculated with a user's liability value (outstanding loan value + accrued interest), collateral value, and the loan-to-value ratio of their collateral.

H=∑i=1∣C∣LtVi∗Vci∑i=1∣L∣VliH=\frac {\sum^{|C|}_{i=1}LtVi*V_{ci}} {\sum^{|L|}_{i=1}V_{li}}H=∑i=1∣L∣​Vli​∑i=1∣C∣​LtVi∗Vci​​

H=H=H= the account's health factor

∣C∣=|C|=∣C∣= the number of collateralized assets held by the account

LtVi=LtV_i=LtVi​= the loan-to-value ratio for collateral asset iii

Vci=V_{ci}=Vci​= the collateral value of collateral asset iii

∣L∣=|L|=∣L∣= the number of outstanding loans held by the account

Vli=V_{li}=Vli​= the liability value of loaned asset iii

A user can increase their health factor by depositing more or decreasing their liability value (e.g. repaying their loans).

collateral
this formula