How to use Stacks Market to Borrow Assets

Start off by going to https://app.zestprotocol.com and connecting a Stacks wallet. We currently support Leather, Xverse, OKX Wallet, and Asigna.

Getting Started

Before you can borrow, you need to supply an asset as collateral. Please refer to How to use Stacks Market to Earn Yield.

Only assets with the green checkmark under the corresponding "Collateral" column can be borrowed against.

As of writing this, all assets in Zest Protocol are in isolation mode: only one type of asset (e.g stSTX, USDC, STX) can be enabled as collateral at a time.

Borrowing Against your Collateral

Once you have supplied collateral, "Borrow" buttons will light up orange under "Assets to borrow"

In the Borrow $XYZ popup, you will see how much you can borrow and what your liquidation price is. The liquidation price is the collateral asset price at which your collateral will get liquidated. If you get liquidated, you get to keep the asset you borrowed but you lose (potentially all of) your collateral.

When you have opened a loan, interest automatically accrues to your debt in the UI.

Health Factor

The health factor applet gives users an easy way to see their loan value at a glance. This value will automatically calculate your LTV ratio.

Your health factor can range from 1 -> 100 (any number above 100 will reflect the ∞ symbol).

If your health factor value goes below 1 - your collateral will be put up for liquidation. See What Happens When I Get Liquidated?

Repaying your Loan

Once you have an open loan, you can repay it totally or partially by clicking "Repay". By partially repaying, you reduce your risk of liquidation. To see your new liquidation price for a repay amount, input a value in the repay input field.

Topping up Collateral

Once you have an open loan, you can add additional collateral to reduce your risk of liquidation. To add additional collateral, supply more of the asset you have enabled as collateral under "Assets to supply". The modal will show your new liquidation price.

For example: the user in this screenshot has stSTX enabled as collateral, so they will need to supply additional stSTX in order to reduce their liquidation risk.

What Happens When I Get Liquidated?

By design, you can only borrow up to 50% LTV (Loan-to-Value). Depositing $1,000 allows you to borrow up to $500.

Your collateral will be put up for liquidation when your LTV ratio hits 70%

We'll consider a user that has $1,000 in STX deposited and their USDC loan has reached $700 from accumulated interest

They have reached 70% LTV and their STX collateral is now put up for liquidation.

Their collateral will be liquidated to pay off the $700 USDC loan + a 10% penalty will be applied.

The user is then left with $200 in STX collateral after the $700 USDC loan is paid off + the $100 in STX liquidation penalty is subtracted.