How to Borrow LUSD using Liquity

Choosing a Liquity frontend

Opening a Trove

  • Liquidation Reserve — This is 200 LUSD subtracted from the LUSD you’ll receive that is set aside in case your position is liquidated. It is not a fee and is returned to you upon repayment of debt.
  • Borrowing Fee — This is the upfront fee you pay to borrow LUSD from Liquity. There are no interest rates, no fixed loan duration, and no fees upon repayment. Pretty good deal right?
  • Collateral ratio — This is the ratio between the value of the collateral in your Trove and your debt in LUSD. The collateral ratio is required to be at least 110% (which is risky). I’ll cover this in more detail in the next section. For now, I’d recommend staying above 150%.

Managing Your Trove




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