A lending position joins a collateral asset to a debt claim. Maximum loan-to-value limits new borrowing; the later liquidation threshold decides when a third party may repay debt and seize collateral.
This educational model uses exact decimal arithmetic and simple interest. It does not reproduce a named protocol, oracle delay, close-factor policy, auction, bad-debt waterfall, or gas cost.
Current position
The borrower deposited 10.000000 ETH worth 20,000.000000 USD and borrowed 12,000.000000 USD. After 0.500000 years, debt is 12,360.000000 USD, LTV is 61.80%, health factor is 1.375×, and the liquidation price is 1,454.117647 USD per ETH. The position remains below maximum LTV with a health factor above the warning boundary.
Risk over time
Move the native slider with arrow keys, Page Up or Page Down, Home, and End. The chart uses circle, triangle, and diamond marks in addition to written status labels.
Current price: 2000 USD per ETH. Debt is 12,360.000000 USD, LTV is 61.80%, health factor is 1.375×, and the position is safe.
| Step | Changed input | Debt | LTV | Health factor | State |
|---|---|---|---|---|---|
| Current price | 2000 USD per ETH | 12,360.000000 USD | 61.80% | 1.375× | Safe |
| −5% price | 1900 USD per ETH | 12,360.000000 USD | 65.05% | 1.307× | Safe |
| −10% price | 1800 USD per ETH | 12,360.000000 USD | 68.67% | 1.238× | Warning |
| −15% price | 1700 USD per ETH | 12,360.000000 USD | 72.71% | 1.169× | Warning |
| −20% price | 1600 USD per ETH | 12,360.000000 USD | 77.25% | 1.100× | Warning |
| −25% price | 1500 USD per ETH | 12,360.000000 USD | 82.40% | 1.032× | Warning |
| −30% price | 1400 USD per ETH | 12,360.000000 USD | 88.29% | 0.963× | Liquidation eligible |
| −35% price | 1300 USD per ETH | 12,360.000000 USD | 95.08% | 0.894× | Liquidation eligible |
| −40% price | 1200 USD per ETH | 12,360.000000 USD | 103.00% | 0.825× | Liquidation eligible |
| −45% price | 1100 USD per ETH | 12,360.000000 USD | 112.36% | 0.756× | Liquidation eligible |
| −50% price | 1000 USD per ETH | 12,360.000000 USD | 123.60% | 0.688× | Liquidation eligible |
| −55% price | 900 USD per ETH | 12,360.000000 USD | 137.33% | 0.619× | Liquidation eligible |
| −60% price | 800 USD per ETH | 12,360.000000 USD | 154.50% | 0.550× | Liquidation eligible |
Position ledger
| Metric | Value | Unit | Meaning |
|---|---|---|---|
| Collateral value | 20,000.000000 | USD | Collateral amount × current price |
| Debt after interest | 12,360.000000 | USD | Principal plus simple accrued interest |
| LTV | 61.80% | percent | Debt ÷ collateral value |
| Health factor | 1.375× | ratio | Liquidation-adjusted coverage |
| Remaining borrowing capacity | 2,640.000000 | USD | Zero-floored capacity at maximum LTV |
| Liquidation price | 1,454.117647 | USD per ETH | Price where health factor reaches 1 |
| Interest accrued | 360.000000 | USD | Principal × annual rate × elapsed years |
| Collateral seized | 0.000000 | ETH | Not eligible |
| Debt repaid in liquidation | 0.000000 | USD | Capped by debt, request, and collateral |
| Debt remaining after liquidation | 12,360.000000 | USD | Debt not repaid by this transition |
Three system perspectives
Each view combines a written explanation, patterned direction cue, and inspectable table.
Assets move into and out of the lending protocol: collateral enters, borrowed assets leave, and seized collateral can move to liquidators.
| From | To | Value or rule |
|---|---|---|
| Borrower | Lending protocol | 10.000000 ETH collateral |
| Lending protocol | Borrower | 12,000.000000 USD borrowed |
| Lending protocol | Liquidator | 0.000000 ETH seized if eligible |
The protocol holds a debt claim while the borrower retains a residual claim on collateral after valid debt and liquidation transfers.
| From | To | Value or rule |
|---|---|---|
| Lending protocol | Borrower | 12,360.000000 USD repayment claim |
| Borrower | Protocol collateral account | Residual claim on 10.000000 ETH before liquidation |
Price declines and interest accrual weaken coverage until the liquidation rule allows a liquidator to repay debt and seize collateral.
| From | To | Value or rule |
|---|---|---|
| Collateral market | Position | 2,000.000000 USD per ETH current price |
| Interest clock | Debt claim | 360.000000 USD accrued |
| Position | Liquidator | Liquidation eligibility is inactive |
Instantaneous downside
Elapsed time and debt stay fixed while collateral price falls.
| Shock | Price | Collateral value | LTV | Health factor | State |
|---|---|---|---|---|---|
| 10% price decline | 1,800.000000 USD/ETH | 18,000.000000 USD | 68.67% | 1.238× | Safe |
| 25% price decline | 1,500.000000 USD/ETH | 15,000.000000 USD | 82.40% | 1.032× | Above maximum LTV |
| 40% price decline | 1,200.000000 USD/ETH | 12,000.000000 USD | 103.00% | 0.825× | Liquidation eligible |
Claim settlement
The interface requests full outstanding debt; the core model caps repayment and seizure.
| Position account | Before | Liquidation action | After |
|---|---|---|---|
| Collateral asset | 10.000000 ETH | 0.000000 ETH seized | 10.000000 ETH |
| Debt claim | 12,360.000000 USD | 0.000000 USD repaid | 12,360.000000 USD |
| Borrower claim | Residual claim on deposited collateral | Not eligible | Residual claim on collateral remaining |
| Liquidator position | No claim before eligibility and repayment | Repays debt and receives collateral plus bonus | Receives 0.000000 ETH |
Guided comparison
Compare a healthy position with price-driven and interest-driven liquidation.