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Configuring protocol constraints
Estimations of:
- Liquidator execution capacity
- Market depth
- Market depth recovery time
come together to help direct the following protocol constraints:
- Asset deposit weights
- Liability borrow weights
- Global protocol deposit limits per asset
- Global protocol borrow limits per asset
and soon:
- Soft deposit and borrow limits in lieu of global hard protocol limits
Weights and global limits control similar protocol exposure, but from different angles:
- Asset and liability weights control the leverage exposure any one account can have, regardless of its size. Today, these are the only account limits that mrgnlend employs
- Global limits control the leverage exposure the overall protocol can have, providing an easier way to manage safe liquidation capacity.
Last modified 4mo ago