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Important features

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Collateral & Safety Guidelines

Borrowing on Juris Protocol is built on a collateralized debt mechanism. To ensure protocol solvency and protect the ecosystem, all loans must be over-collateralized. This means the value of your pledged assets must always exceed the value of your borrowed debt.

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The Health Factor ()

The Health Factor is the primary indicator of your account's safety. It is a live calculation of your collateral value versus your total debt.

  • (Green): Safe. Your position is well-collateralized and can withstand significant market swings.

  • (Yellow): Warning. Your position is becoming risky. Consider adding more collateral or repaying part of the loan.

  • (Red): Liquidation Risk. Your collateral is no longer sufficient to back the loan. The protocol may liquidate your assets to cover the debt.

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Dynamic Interest Rates

Juris Protocol does not use flat interest rates. Instead, rates are market-responsive:

  • Pool Utilization: As more users borrow a specific asset, the interest rate for that asset increases. This incentivizes lenders to provide more liquidity and encourages borrowers to repay.

  • Real-Time Adjustments: Rates are calculated per block, ensuring you always pay a fair market price based on current demand.

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Core Safety Strategies

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1. Maintain a Safety Buffer

Market volatility is a constant in DeFi. Aim to keep your Health Factor above 1.5 at all times. This provides a "cushion" during flash crashes or sudden price drops in your collateral assets.

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2. Diversify Your Collateral Baskets

Juris Protocol allows you to mix assets (e.g., $LUNC and $USDC) in one borrowing account.

  • Benefit: If one asset drops in price, the stability of the other (like a stablecoin) can prevent your Health Factor from plummeting.

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3. Monitor Utilization Trends

Before borrowing, check the "Details" tab of the asset. If utilization is near 90-100%, the interest rate will be at its peak. It may be more cost-effective to wait for utilization to drop or to borrow a different asset.

[!CAUTION]

Liquidation is permanent. Once a liquidation is triggered by the smart contract, it cannot be reversed. Use the real-time dashboards to stay informed of your position's health 24/7.

PreviousManaging Your Borrowing AccountsNextLiquidation Market

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