APY: abbreviation of Annual Percentage Yield, a normalized representation of an interest rate, based on a compounding period of one year.
Deposit APY: the variable interest rate that is earned by lending assets to Proton Loan.
Variable borrow APY: the variable interest rate that is paid to borrow Tokens. High utilization = high APY. Low utilization = low APY.
Borrow amount: the amount that will be borrowed.
Max borrow: the maximum amount that can be borrowed.
Max borrow to deposits: is the maximum amount you can borrow off of deposits. If you deposit $100 BTC, you can borrow $70 worth of any asset off of it. This is also known as loan to value (LTV).
Deposit amount: is the amount you wish to deposit, it cannot exceed more than what you have available in your wallet.
Max deposit: is the maximum amount that can be deposited (it’s the amount you have available in your wallet).
Withdraw amount: is the amount that will be withdrawn.
Max withdraw: is the maximum amount that can be withdrawn.
Repay amount: is the amount that will be repaid.
Repay max: the amount that will be repaid. Any over-repayment of an outstanding loan will be automatically returned.
Collateral: In crypto-backed lending, collateral is the cryptocurrency asset that the borrower pledges as a guarantee that the loan is going to be repaid. The crypto collateral is returned upon the full repayment of the credit.
In traditional banking, a common example of collateral in a mortgage – the asset (i.e. house) that is being financed is usually the collateral that secures the loan. Meaning, if the loan is not repaid on schedule, the asset ( i.e. house) is repossessed.
Max collateral: the maximum amount you’re able to collateralize.
Utilization rate: percentage of deposits that are currently borrowed by everyone in the market.
Liquidation: When your Loan health reaches 0%, the Loan is considered to be insolvent and is at risk to be liquidated. Read more on liquidations here.
Liquidation fee: the premium liquidators receive on the liquidated loan collateral. The current bonus liquidators get as a reward on collateral is 10%, so If they liquidate $100 of insolvent debt, they will receive ~$110 of the collateral.
Loan Health: reflects the risk level based on the outstanding loan balance and your deposited collateral. You can monitor your loans on the portfolio page and make repayments accordingly to improve your Loan Health and avoid being liquidated. When Loan health reaches 0%, the Loan is considered to be insolvent and is at risk to be liquidated. Read more on liquidations here.
Loan Duration: loans are perpetual and as long as your loan heath stays above 0%, you will not be liquidated.