Manage Risk
Last updated
Last updated
Multiply positions are leveraged debt positions that can be liquidated if borrow rates exceed staking rates for an extended period of time, or if the LST smart contract is exploited.
Due to a change in our LST oracle infrastructure, LST depegs can no longer cause liquidations for Multiply positions. Read more here:
The risk of a position is indicated by two values:
Loan-to-value (LTV)
Liquidation Price
Note that both of these values are important primarily in Multiply vaults that are not LST/SOL loops, such as, for example, JLP Multiply.
The LTV of your position expresses your debt as a percentage of your collateral. A higher LTV means a riskier position. If your LTV reaches the liquidation threshold (indicated by the "x% from liquidation sub-value"), your position is eligible for liquidation
Liquidation price is the collateral/debt price ratio at which your position will be eligible for liquidation. This means that, if your collateral asset drops in value relative to your debt (eg. JitoSOL drops in value relative to SOL), it will be liquidated when it reaches this price ratio. The Current Price will tell you where the ratio currently stands:
Managing a multiply position is simple:
If you lower your leverage, your position is safer, and has a larger buffer to liquidation
If you increase your leverage, your position becomes riskier, and has less buffer to liquidation
Adjusting your position size (i.e. depositing/withdrawing) has little to no effect on the risk of your position
Increasing your leverage will move your position closer to liquidation. When you increase your leverage amount, you will see the following values increase:
Total Collateral
Total Debt
LTV Ratio
Liquidation Price
Multiplier
Net APY will then typically increase, though this may depend on the staking rate - borrow rate equation, as well as your position size.
When you decrease your leverage, the exact opposite will happen: your position becomes safer, and the following values will decrease:
Total Collateral
Total Debt
LTV Ratio
Liquidation Price
Multiplier
Net APY will then typically decrease, though this may vary depending on current rates and your position size.