Configuring protocol constraints
Bringing it together
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 provide double coverage
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.
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