Borrowing lets you access liquidity without selling the assets you hold. You supply assets as collateral, then borrow other assets against them, and you pay interest on what you borrow. Here's how to get started.
Why Borrow?
People borrow on Moonwell to:
Access liquidity without selling, so you keep your exposure to an asset while putting its value to work.
Avoid triggering a sale in some situations (consider your own circumstances; this isn't financial or tax advice).
Put idle collateral to use, for example borrowing a stablecoin against ETH you want to keep.
Borrowing always carries liquidation risk, so it's worth understanding the mechanics before you start.
Before You Borrow
First, supply assets and enable them as collateral. Your borrowing power depends on:
The assets you've supplied
How much you've supplied
The collateral factor for each asset
For example, if you supply $1,000 USDC with an 80% collateral factor, you can borrow up to $800 worth of other assets.
Steps to Borrow
Go to the Markets page.
Select the asset you want to borrow.
Enter the amount you want to borrow.
Review the transaction details, including the borrow APY and your resulting credit usage.
Confirm the transaction in your wallet.
Tip: Borrow well below your maximum. Leaving a buffer gives your position room to absorb price swings before liquidation becomes a risk.
Key Points
You can borrow multiple assets at the same time.
Your borrowing power is based on your collateral and its collateral factors.
Keep your borrow usage well below 100% to avoid liquidation risk.
The lower your credit remaining percentage, the closer you are to liquidation.
What Happens Next
Once your borrow is confirmed, you'll see the borrowed amount in your account. Interest accrues immediately based on the market's current borrow rate, and the longer you hold the loan, the more interest you owe. You can repay at any time, in any amount.
Managing Your Risk
After you borrow, keep an eye on your position. If your collateral falls in value or your borrowed asset rises, your credit remaining shrinks and liquidation risk grows. You can reduce risk by repaying part of your loan or adding more collateral.
Frequently Asked Questions
Do I have to sell my crypto to borrow?
No. That's the point of borrowing: you keep your supplied assets and borrow against them.
What can I borrow?
You can borrow assets available in the markets on your network, as long as you have enough borrowing power. See the Borrow page for current options and rates.
Is there a minimum borrow amount?
No set minimum, though gas fees make very small borrows impractical.
How much should I borrow?
That's your call, but borrowing close to your limit leaves little room for price movement. A conservative buffer reduces liquidation risk.