Risk Parameters
Introduction
The composability of the DeFi ecosystem implies risks from an individual component flow into all dependent systems. Currencies are at the heart of the Molend protocol as they enable operations and hold the assets and liabilities of the protocol.
Risk Parameters
Each asset in the Molend protocol has specific values related to their risk, which influences how they are supplied and borrowed. The table below shows a summary of the latest values.
The table below results from the asset risk assessment relating to security and the markets. Tokens with security concerns around their smart contract cannot be considered for integration since these risks are impossible to control. Similarly, tokens with high risk exposure to single counter-parties cannot be used as collateral.
Maximum LTV
70%
80%
80%
Liquidation Threshold
75%
85%
85%
Liquidation Penalty
15%
15%
15%
Reserve Factor
65%
65%
65%
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