Supply and Borrow Cap

Supply Caps

Supply caps define the maximum amount of an asset which can be supplied to the protocol. Supply caps can be used to limit the protocol’s exposure to riskier assets and protect against infinite minting exploits. A supply cap is an optional parameter, and the value will depend on on-chain liquidity of the asset and total volume of collateral assets in the pool.

Borrow Caps

Borrow caps define the maximum amount of an asset which can be borrowed. Borrow caps can be used to prevent traditional and flash borrowing of an asset which may experience a price exploit and lead to protocol insolvency. A borrow cap is an optional parameter, and the value will depend on-chain liquidity of the asset and total volume of borrowed assets in the pool.