# Assets & Risk Parameters

### Core Risk Parameters <a href="#core-risk-parameters" id="core-risk-parameters"></a>

**Loan-to-Value (LTV)**

The LTV determines the maximum amount you can borrow against an asset.

<table><thead><tr><th width="235.43359375">LTV</th><th>Meaning</th></tr></thead><tbody><tr><td>85%</td><td>Borrow up to 85% of collateral value</td></tr><tr><td>80%</td><td>Borrow up to 80% of collateral value</td></tr><tr><td>60%</td><td>Borrow up to 60% of collateral value</td></tr></tbody></table>

**Higher LTV** = More capital efficient, used for stable/liquid assets

**Lower LTV** = More conservative, used for volatile/newer assets

<details open>

<summary>Why do assets have different LTV?</summary>

LTV reflects risk assessment:

* **Stablecoins** (USDC, suiUSDT) — 85% LTV, minimal price volatility
* **Major assets** (SUI, stSUI) — 85% LTV, high liquidity and established markets
* **Wrapped BTC variants** — 80% LTV, bridge/wrapper considerations
* **Newer or volatile assets** — 45-60% LTV, higher price risk

Lower LTV provides more buffer before liquidation if prices drop rapidly.

</details>

**Liquidation Threshold**

The liquidation threshold (LT) is the point at which your position becomes eligible for liquidation. This is typically set at 85-90% for most assets — generally 5% above the maximum LTV.

<div data-with-frame="true"><figure><img src="/files/Iy57SfAofMFkZOxMoVKB" alt=""><figcaption></figcaption></figure></div>

The gap between LTV and liquidation threshold provides a safety buffer:

* At 80% LTV: LT is 85%, giving a 5% buffer before liquidation
* At 85% LTV: LT is 90%, giving a 5% buffer before liquidation

Once your position exceeds the LTV ratio but remains below the liquidation threshold, you cannot withdraw collateral. This restricted zone acts as a warning period — your position is unhealthy, but not yet subject to liquidation.

<div data-with-frame="true"><figure><img src="/files/n6I3F7v5PbRVoiUCDH8F" alt=""><figcaption></figcaption></figure></div>

**Supply and Borrow Caps**

<figure><img src="/files/QaL3S9mtYsMDgNL9UauN" alt=""><figcaption></figcaption></figure>

Caps limit the total amount of each asset that can be supplied or borrowed:

* **Supply Cap** — The maximum amount that can be deposited for an asset
* **Borrow Cap** — The maximum amount that can be borrowed for an asset

Caps protect the protocol from:

* Excessive concentration in a single asset
* Liquidity risks during market stress
* Oracle manipulation attacks

You can view current utilization against caps on each asset's detail page.

### Asset Categories <a href="#asset-categories" id="asset-categories"></a>

**Main Markets**

<div data-with-frame="true"><figure><img src="/files/M32QhnxJjhckB9sqChb0" alt=""><figcaption></figcaption></figure></div>

The primary markets include established assets with standard risk parameters:

* SUI and liquid staking derivatives (stSUI)
* Major stablecoins (USDC, suiUSDT)
* Wrapped Bitcoin variants
* Other established tokens

**Isolated Markets**

<div data-with-frame="true"><figure><img src="/files/wegVfzitcg90hXn9wcXR" alt=""><figcaption></figcaption></figure></div>

Isolated markets contain assets that require additional risk management:

* Newer tokens with less price history
* Assets with lower liquidity
* Tokens with additional smart contract risk

Assets in isolated markets may have:

* Lower LTVs
* Stricter borrow caps
* Limited collateral usage

**Ember Markets**

<div data-with-frame="true"><figure><img src="/files/8wEbNff43qkrfYawal7D" alt=""><figcaption></figcaption></figure></div>

Ember markets contain yield-bearing vault tokens from Ember Protocol.

When you deposit assets into Ember vaults, you receive a tokenized representation (e.g., eSUI) that accrues yield. These tokens can then be deposited into AlphaFi Lend and used as collateral, similar to how you would use the underlying asset like SUI.

**Retired Markets**

Retired markets contain deprecated assets. These are closed to new supplies and borrows but existing positions can be managed and closed.

### Price Oracles <a href="#price-oracles" id="price-oracles"></a>

AlphaFi Lend uses [Pyth](https://pythdata.app/explore) price feeds to determine asset values across the protocol. These prices drive all core calculations — collateral valuations, borrow limits, liquidation triggers, and health factors.

**How Oracle Prices Are Used**

<table><thead><tr><th width="172.42578125">Calculation</th><th>Role of Oracle Price</th></tr></thead><tbody><tr><td>Collateral value</td><td>Determines the USD value of your supplied assets</td></tr><tr><td>Borrow limit</td><td>Collateral value × LTV, derived from oracle prices</td></tr><tr><td>Liquidation check</td><td>Compares debt value to collateral value in real time</td></tr><tr><td>Health factor</td><td>Based on the ratio of collateral to debt at current prices</td></tr></tbody></table>

**Pyth Network**

[Pyth](https://pythdata.app/explore) provides high-frequency price updates sourced from institutional market data providers. Key characteristics:

* Pull-based updates — Prices are updated on-chain when needed, reducing unnecessary transactions
* Sub-second latency — Price data reflects near real-time market conditions
* Multiple data sources — Each feed aggregates prices from numerous providers to reduce manipulation risk

Pyth is purpose-built for DeFi price feeds on high-performance chains like Sui. Its pull-based model aligns with Sui's architecture, delivering fresh prices without the overhead of constant on-chain updates. The breadth of institutional data sources provides resilience against single-source failures or manipulation.

**Price Staleness**

If an oracle price becomes stale or unavailable, the protocol may restrict operations on the affected asset to protect users from acting on outdated valuations.

### Additional Parameters <a href="#additional-parameters" id="additional-parameters"></a>

**Spread Fee**

The spread between supply and borrow rates (typically 15%). This margin covers:

* Protocol reserves
* Risk buffer
* Operational costs

**Borrow Weight**

A multiplier applied to borrowed amounts for risk calculations. A borrow weight of 1 means the asset is counted at face value.

### Checking Asset Parameters <a href="#checking-asset-parameters" id="checking-asset-parameters"></a>

To view complete parameters for any asset:

1. Click on the asset row in the markets table
2. Review the "Reserve Status & Configuration" section
3. Key metrics displayed:
   1. Maximum LTV
   2. Liquidation Threshold
   3. Close Factor
   4. Current utilization
   5. Supply and borrow caps
   6. Historical borrow and supply APRs


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