Deposit Collateral

Unlocking Leverage

In Vanna Protocol, the Deposit Collateral feature is essential for unlocking leverage through your margin account. Traders must provide collateral to borrow funds from the lending pool. This collateral secures the borrowed capital, ensuring the safety of the lending pool while granting traders access to leverage.

Supported Collateral Types

Vanna supports a wide range of collateral types, focusing on high-liquidity assets for efficient leverage, including:

• Native Assets: Popular cryptocurrencies such as ETH, WBTC, USDT, USDC, and DAI, which offer high liquidity and stability, making them ideal for collateral. Additional altcoins will be introduced over time to expand collateral options

• LSTs (Liquid Staking Tokens): Assets like stETH that represent staked tokens, providing both leverage and staking rewards, allowing traders to benefit from staking yields while using them as collateral

• LRTs (Liquid Restaking Tokens): Tokens like those generated from EtherFi and similar protocols, allowing traders to restake on secondary networks and accrue rewards while using them as collateral.

Collateral Management & Health Factor

The amount and type of collateral determine the borrow limit (the maximum amount a trader can borrow), and the system assigns a health factor based on the ratio of collateral to borrowed funds. Maintaining a healthy factor is crucial to avoiding liquidation.