Isolation Mode

Isolation Mode enables the creation of isolated lending pools, each containing a distinct set of assets with customized risk parameters. This approach enhances risk management by containing potential disruptions within individual markets, safeguarding the overall protocol’s liquidity.

Entering Isolation Mode

Isolation Mode is available for select assets approved by LNDfi Governance. To activate it:

1. Choose an Isolated Asset: Navigate to the dashboard and select an eligible isolated asset to supply.

2. Alert: A notification will appear, confirming that you are entering Isolation Mode.

1. Supply Assets: Deposit the selected isolated asset into the designated lending pool.

2. Borrow Assets: While in Isolation Mode, borrowing is restricted to stablecoins explicitly approved for this mode by LNDfi Governance.

Exiting Isolation Mode

To exit Isolation Mode, follow these steps:

1. Disable Isolated Asset: Navigate to the “Your Supplies” section and toggle the slider to deactivate the asset.

2. Confirm Exit: Click “Disable Asset as Collateral”, review the Gas Fee, and confirm the transaction to successfully exit Isolation Mode.

Effects on Borrowing Power

While in Isolation Mode, borrowing is limited exclusively to approved stablecoins (USDT,USDC etc). Additionally, a predefined debt ceiling applies to each isolated asset, restricting the total borrowable amount. This limit is displayed on the asset’s reserve page.