Borrowing
Deposit supported collateral, mint nUSD, manage risk, and repay your position.
Borrowing lets you unlock nUSD liquidity while keeping exposure to a supported asset. Every position belongs to one wallet and one collateral market.
How it works
- Choose a supported market in the Nest app.
- Deposit collateral into that market's on-chain vault.
- Mint nUSD up to the market's available borrowing limit.
- Monitor the position as prices and fees change.
- Repay nUSD and accrued fees before withdrawing all collateral.
Borrow LTV and liquidation threshold
The borrow LTV is the maximum debt ratio allowed when you mint nUSD or withdraw collateral. The liquidation threshold is a higher ratio at which the position can be liquidated.
For example, consider a market with a 70% borrow LTV and an 80% liquidation threshold:
| Collateral value | Debt | LTV | Result |
|---|---|---|---|
| $1,000 | $650 | 65% | Below the borrow limit |
| $1,000 | $750 | 75% | Cannot borrow more, but not liquidatable |
| $875 | $700 | 80% | At the liquidation boundary |
The gap between the two limits gives a position room for market movement. Each market can use different limits, caps, and fees. Read the current values in the app before approving a transaction.
Stability fees
A stability fee accrues on the outstanding debt. The app includes accrued fees when it displays total debt and position health. Repayments settle accrued fees before reducing principal.
Stability fee rates can differ by market and can change after existing fees are checkpointed. A rate update does not retroactively apply the new rate to the entire age of a position.
What changes position health
Your position becomes riskier when:
- the collateral price falls;
- debt increases;
- stability fees accrue; or
- oracle confidence causes the protocol to use a more conservative value.
Adding collateral or repaying debt improves the position. Liquidation can sell collateral to settle debt and includes a liquidation penalty.
Do not borrow at the maximum
Borrowing to the limit leaves little room for price movement or accrued fees. Choose a personal safety buffer below the protocol maximum.