DeFi HUB / Lending and borrowing
Getting started
Lending and borrowing
Supplying a token lets other people borrow it. Borrowing means you post collateral and take another asset. If the collateral’s value falls too far, the program can seize it and repay the debt.
A first borrow, if you borrow at all
Use case: you supply a stablecoin you can leave in the contract, and you do not borrow against it yet. You learn where the supply balance is shown and how to withdraw. Borrowing adds a liquidation price. Skip that until you can point at the health number on the screen and say what moves it.
A volatile coin as collateral with a large borrow is how small dips become forced sales. The program will not call you first. The transaction that liquidates you is public and automatic.
Questions
Is the supply rate a salary?
No. It is a variable rate the pool sets from borrowing demand. It changes, and the token you supplied can still fail.