# E-Mode Borrowing

### What is E-Mode? <a href="#what-is-e-mode" id="what-is-e-mode"></a>

{% hint style="info" %}
Following the V2 launch, borrow caps on the V1 have been reduced to encourage migration to the more efficient V2.
{% endhint %}

E-Mode is designed to enhance capital efficiency when the collateral and borrowed assets closely track each other in price. Since **STX**, **stSTX**, and **stSTXbtc** are highly correlated, users can safely borrow more of these assets compared to standard borrowing parameters.

In E-Mode, users benefit from: – **80% maximum Loan-to-Value (LTV)** – **85% Liquidation Threshold** – **5% Liquidation Penalty**

For example, with $1,000 in STX / stSTX / stSTXbtc as collateral, a user can borrow up to **$800** in STX or stSTX—compared to only **$500** in standard mode.

|                       | Traditional Borrowing | E-Mode Borrowing |
| --------------------- | --------------------- | ---------------- |
| Max LTV               | 50%                   | 80%              |
| Liquidation Threshold | 75%                   | 85%              |
| Liquidation Penalty   | 10%                   | 5%               |

### How to Activate E-Mode? <a href="#how-to-activate-e-mode" id="how-to-activate-e-mode"></a>

**How to Activate E-Mode**

1. First, ensure you’ve supplied either **STX**, **stSTX**, or **stSTXbtc**, and that one of them is marked as your collateral asset.
2. In the **‘Your Borrows’** section, click the **E-Mode** button. A pop-up will display the assets eligible for E-Mode. Proceed to activate it from there.

{% hint style="info" %}
If you have an active borrowing position in standard mode, you’ll need to fully repay it before activating E-Mode.
{% endhint %}

<figure><img src="https://563839015-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FGfC8dsUgiIuFFUi3sa84%2Fuploads%2F2175ZJvmn9HE2zwvh8Dx%2Fimage%20(1).png?alt=media&#x26;token=9367a302-9e93-47d6-841d-f8c91c3c523c" alt=""><figcaption></figcaption></figure>

Once activated, only assets available for borrowing within E-Mode will be shown.

To deactivate E-Mode, simply click the **E-Mode** button again and confirm deactivation to return to the standard borrowing markets.

{% embed url="<https://www.loom.com/share/cac04e30d7944ce3b339df8754c545ab>" %}