Health Rate

The Health Rate is a key metric that indicates the safety of your borrowed position. It represents the relationship between your collateral and borrowed amount, weighted by the liquidation threshold.

Understanding Health Rate

The Health Rate is calculated using the following formula:

Health Rate = (Total Collateral Value × Liquidation Threshold) / Total Borrow Value

Where:

• Total Collateral Value: Current market value of your deposited DYM

• Liquidation Threshold: 0.833 (representing the 120% minimum collateral ratio)

• Total Borrow Value: Amount of OUSD borrowed

Risk Levels

• 🟢 Health Rate > 1.5: Safe zone, comfortable buffer against market volatility

• 🟡 Health Rate 1.1-1.5: Warning zone, monitor closely

• 🔴 Health Rate 1 < 1.1: Danger zone, repay some debt or add more collateral

• 🔴 Health Rate <= 1: Position eligible for liquidation

Example

If you have:

• 1000 DYM as collateral (valued at $1000)

• 500 OUSD borrowed Your Health Rate would be:

(1000 × 0.833) / 500 = 1.666 (🟢 Safe Zone)

Best Practices

• Monitor your Health Rate regularly

• Maintain a Health Rate above 1.5 for safety

• Add collateral or repay the debt if the Health Rate drops

• Set up notifications for Health Rate changes