Borrowing Assets

Important Note:

• If you supplied an asset in the Main Pool, you can only borrow assets within this pool.

• Similarly, if you supplied an asset in the Veno Pool, you can only borrow assets within this pool.

• The same rule applies to the DeFi Pool. Click here to lean about isolated pools.

1) First, you need supply an asset on Tectonic. The tutorial for supplying an asset can be found here

2) Once supplied, you will need to enable the asset for use as collateral. You can do this either in the Dashboard page or within the individual asset markets page (for example, the individual asset markets page for USDC can be found here). You will need to confirm the "Use as collateral" transaction in your wallet.

Dashboard Page

Individual asset markets page

3) Then, head to the Markets page and select the asset that you intend to borrow. You will be taken to that asset's individual markets page

On Markets Page, click on an asset

Individual asset markets page

4) Click on the “Borrow” button and indicate the amount you intend to borrow. See the below example for TONIC.

5) Confirm your transaction in your wallet

6) A pop-up will appear to indicate a successful transaction

7) Upon successful completion, you can then view your supply and borrow balances within the Dashboard Page

The dashboard provides key information such as the supply balance, borrow balance, Net APY, Current Loan-To-Value (LTV), available borrowing power, and the list of supplied and borrowed assets

Commonly asked questions

Q) How do I check the health of my loan to make sure it remains below liquidation levels?

A: The best way to determine the "health" of your loan is to look at the lava bar (shown in the screenshot below).

As a rule of thumb, we recommend that you maintain your lava bar below 50%. This loan-to-value ratio could help better protect your position from liquidation during volatile market periods.

Q) What does "Exceeds Borrow Limit" mean?

A: If you attempt to borrow an amount that takes your lava bar beyond 90%, you will exceed our specified borrow limit and not be allowed to complete the transaction.

Q) Why can't I borrow the same asset that I deposited?

A: We have disabled the supplying and borrowing of the same asset on this platform. This means that if you have supplied CRO, you will not be able to use this asset as collateral to borrow more CRO.

This is done as we are aware of whales who often do leveraged stablecoin farming to receive more incentives. Leveraged stablecoin farming is the act of supplying and borrowing the same asset, typically stablecoins, in a continuous loop. This restriction ensures that our incentives are spread across a larger Cronos user base, benefiting all users who are using the Tectonic platform.

Q) What is Net Borrow APY / Distribution APY?

A: Net Borrow APY = Fees paid by user for borrowing asset - Distribution APY

• If Net Borrow APY is negative, Distribution APY > Fees paid for borrowing asset. This essentially means the user is being paid to borrow the asset.

Distribution APY = TONIC rewards paid to user

• if Distribution APY = 0%; there are no TONIC rewards paid out for that market

Q) What is "Borrow balance"?

A: Borrow balance is the total amount of loans you have taken out on Tectonic, displayed in USD terms