Collateral Management

Collateral Management

Collateral is the foundation of your leverage on Portal. This page explains how to manage it effectively to reduce risk and support open positions.

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What Is Collateral?

Collateral is the asset you deposit into Portal to support leveraged positions. It determines your margin level and affects how much you can borrow.

You can deposit:

• ETH

• USDC

• USDT

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How to Deposit Collateral

Depositing collateral is done from the Dashboard tab within Portal.

To deposit:

1. Navigate to Portal on Loopring DeFi.

2. Click the Dashboard tab at the top.

3. Select Collateral Management.

4. Choose to Supply either ETH, USDC, or USDT.

5. Enter the amount you wish to deposit and confirm the transaction in your wallet.

Once deposited, your collateral will appear in your balance and begin supporting your positions immediately.

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How Collateral Affects Margin

The more collateral you deposit, the higher your margin level, and the less risk of liquidation.

• Adding collateral increases your ability to borrow or withstand volatility.

• Removing collateral reduces your margin level and may increase liquidation risk.

💡 Keep your margin level above 1.5 to stay in a low-risk zone.

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Withdrawing Collateral

Withdrawing collateral is done from the Dashboard tab within Portal.

To withdraw:

1. Go to the Portal section in Loopring DeFi.

2. Click the Dashboard tab.

3. Select Collateral Management.

4. Click Reduce and then select the token you'd like to withdraw.

5. Enter the amount and confirm the transaction in your wallet.

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Withdrawal Limitations

You can only withdraw collateral that exceeds twice the value of your total debt. This ensures that your margin level remains healthy and avoids triggering liquidation.

⚠️ Withdrawing too much collateral can lower your margin level and put your position at risk of liquidation.

Example: How much can I withdraw?

Let's say you have:

• Total collateral: $600

• Total debt: $200

Because your collateral is 3× your debt, you're above the required 2× threshold.

You can withdraw up to $200 in this scenario while still maintaining a healthy margin level.

If your collateral falls below twice your debt, the Reduce option will not allow further withdrawals.

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Best Practices

• Always monitor your margin level when adding or withdrawing collateral.

• It’s recommended to use stablecoins (USDC or USDT) as collateral to avoid dual volatility exposure.

• Recheck your position after each collateral action to ensure it remains stable.

Why mix collateral?

Using a mix of ETH, USDC, and USDT can offer several benefits:

• Asset Diversification: Reduces reliance on a single token for margin safety.

• Stability: USDC and USDT are stablecoins, helping buffer against crypto market volatility.

• Flexibility: Allows you to add or withdraw specific tokens based on availability and market conditions.

A diversified collateral base can help you better manage margin level risk and stay flexible when adjusting your positions.

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🔗 Quick Access

• Back to Portal Overview
• Understanding Margin & Liquidation