Where Is The Cheese — #5 Lend on Mars
Welcome back to our “🧀Where is the Cheese?🧀” series!
Your feedback, Milkers, has been overwhelmingly positive about using milkTIA on lending protocols. In response, we’re thrilled to share that we’ve partnered with Mars Protocol, offering you another solid platform to milk your TIA.
For full coverage of the milkTIA use cases, 👉 check out our Discovery page.
Introduction to Mars Protocol
Mars is a credit protocol for the future: decentralized, self-sovereign, inter-chain, non-custodial, open-sourced, and community-governed.
Like existing credit protocols, Mars’ “Red Bank” facilitates overcollateralized loans with a two-slope interest rate model (similar to Aave or Compound).
Check out their documentation site for more detailed information.
Lend on Mars
Here’s how you can get started:
- Access Mars: First, navigate to the Mars Protocol.
- Connect Your Wallet: Connect your wallet that holds your milkTIA tokens.
- Create Credit Account: Click on Credit Account, and then click on Create, and confirm transaction. Skip this step if Credit Account was created previously.
- Fund Credit Account: Select milkTIA, enter the amount you wish to fund, and confirm transaction.
- Lend milkTIA: Go to the Earn page, select milkTIA, click Lend, enter the amount you wish to lend. Review and confirm.
Borrow on Mars
After lending out your milkTIA tokens as collateral, you can then borrow on Mars:
- Borrow: Navigate to the Borrow page, select the asset you wish to borrow and enter the amount. Note that milkTIA itself cannot be borrowed.
- Confirmation and Monitoring: Confirm the transaction. Once it’s processed, you will receive borrowed assets to freely use for other DeFi opportunities and you can monitor your position’s health status directly on your Portfolio page page.
Risk Parameters
milkTIA has the following risk parameters at launch per #169 Governance Proposal:
- Max. LTV: 48.5%
- Liquidation LTV: 50%
- Deposit Cap: 50,000 milkTIA
Please note that these risk parameters are subject to change, make sure you stay up to date on the latest information when interacting with the protocol.
Tips for Using Mars Protocol
- Prevent Liquidation: To mitigate liquidation risks, it is essential to constantly monitor your health factor on the Portfolio page. We highly recommend reading Mar’s blog to understand how the liquidation threshold is calculated and to comprehend the circumstances under which liquidation occurs before you begin borrowing.
- Keep an Eye on Interest Rates: Interest rates can fluctuate. Regularly check them to ensure your lending strategy remains profitable.
- Stay Informed: The DeFi space is rapidly evolving. Stay updated with Mars Protocol’s updates and general DeFi trends.
Disclaimer: none of this is financial advice. Please do your own due diligence before participating in any of the mentioned protocols.
This wraps up the fifth post of the Where Is The Cheese Series.
Happy Milking! 🐄🥛
