> ## Documentation Index
> Fetch the complete documentation index at: https://docs.areal.finance/llms.txt
> Use this file to discover all available pages before exploring further.

# Borrowing

> Borrow against RWT or stRWT without selling, via the Omnipair lending market

export const MarketLive = () => <iframe src="https://0xrealist.github.io/docs-widgets/market/?v=20260616c" title="RWT / stRWT market (live)" loading="lazy" scrolling="no" className="wfr wfr-market" style={{
  colorScheme: "normal"
}} />;

**Hold RWT or stRWT and borrow against it without selling.** Borrowing runs on an external
**RWT / stRWT** lending market built on **Omnipair**, an oracle-free GAMM (generalized AMM) where
the pool itself prices collateral and debt.

<a href="https://www.omnipair.fi/market/EYpKtcY5xkA8aQQTKYyEpFdRua5GM47YVWVfG9scn4Hd" target="_blank" rel="noreferrer" className="cta-card">
  <img src="https://mintcdn.com/areal/GW8KOHcnZ4w6FV2C/images/omnipair.png?fit=max&auto=format&n=GW8KOHcnZ4w6FV2C&q=85&s=f23958748533d4fe401df20d0360bc36" alt="Omnipair" width="512" height="512" data-path="images/omnipair.png" />

  <div>
    <div className="cta-title">Open the RWT / stRWT market on Omnipair</div>
    <div className="cta-sub">Deposit collateral and borrow in the live lending market</div>
  </div>

  <span className="cta-arrow">↗</span>
</a>

<MarketLive />

## How to borrow

<Steps>
  <Step title="Open the market">
    Open the RWT / stRWT market on Omnipair and connect your wallet.
  </Step>

  <Step title="Deposit collateral">
    Supply **RWT** or **stRWT** as collateral.
  </Step>

  <Step title="Borrow">
    Draw the paired token up to your borrow limit (collateral value times the max LTV).
  </Step>

  <Step title="Manage and repay">
    Watch your health factor and repay the borrowed amount plus accrued interest at any time.
  </Step>

  <Step title="Withdraw">
    Once the debt is cleared, withdraw your collateral.
  </Step>
</Steps>

## Key terms

<CardGroup cols={2}>
  <Card title="Borrow limit" icon="gauge">
    The most you can borrow now: collateral value times the max borrow LTV.
  </Card>

  <Card title="Max borrow LTV" icon="arrow-up">
    The highest loan-to-value allowed when opening or increasing a loan.
  </Card>

  <Card title="Liquidation LTV" icon="triangle-exclamation">
    The LTV at which the position becomes liquidatable.
  </Card>

  <Card title="Health factor" icon="heart-pulse">
    Headroom before liquidation. Above 1 is safe; at 1 liquidation can occur.
  </Card>

  <Card title="Liquidation price" icon="dollar-sign">
    The collateral price at which the health factor reaches 1.
  </Card>

  <Card title="Swap fee" icon="percent">
    0.25% on swaps routed through the pool.
  </Card>
</CardGroup>

## Looping strategy

Looping is a common DeFi strategy that uses borrowing to amplify a position. You deposit
collateral, borrow against it, convert the borrowed asset back into more collateral, and repeat.
Each loop increases your exposure (and yield) on the same starting capital, at the cost of higher
liquidation risk.

A natural loop here amplifies **staking yield**:

<Steps>
  <Step title="Stake and deposit">
    Stake RWT into stRWT and deposit the stRWT as collateral.
  </Step>

  <Step title="Borrow RWT">
    Borrow RWT against the stRWT, staying well under the max LTV.
  </Step>

  <Step title="Re-stake">
    Stake the borrowed RWT into more stRWT and deposit it as well.
  </Step>

  <Step title="Repeat">
    Loop again to compound the exposure.
  </Step>
</Steps>

Each loop puts more stRWT to work earning the staking reward share on borrowed capital, so the
effective yield on your initial deposit is multiplied. This is profitable while the staking yield
stays above the borrow interest rate. The trade-off is more debt and a tighter health factor, so
the position is more sensitive to rate and price moves. Loop conservatively and keep a buffer.

## Liquidation

<Warning>
  If your health factor falls to 1 (your LTV reaches the liquidation LTV), the collateral can be
  liquidated to repay the debt. Watch the liquidation price, keep a buffer, and repay or add
  collateral before it is reached. Interest accrues on the debt over time, which lowers the health
  factor even if prices do not move.
</Warning>

## Pool parameters

The RWT / stRWT pool is an Omnipair GAMM. These parameters define the borrowing conditions.

* **Oracle-free pricing.** The pool prices collateral and debt from its own reserves, with no
  external oracle. There is nothing to feed a wrong price and no oracle to fail.
* **EMA half-life: 120 minutes.** Instead of the raw spot price, the pool uses an exponential
  moving average (EMA) of its price. The half-life is how long it takes for a price change to be
  half absorbed into that average. At 120 minutes the price reacts gradually, so a sudden swing
  or a flash manipulation barely moves the value used for borrowing and liquidation. Longer
  half-life means smoother and more manipulation-resistant pricing, at the cost of reacting more
  slowly to genuine moves.
* **Dynamic (AUTO) LTV.** The max borrow LTV and liquidation LTV are set automatically by the
  protocol from live pool conditions, rather than fixed numbers.
* **Target utilization: 30 to 50 percent.** The interest-rate model aims to keep borrowing
  utilization inside this band. Below it, borrow rates stay low to encourage borrowing; above it,
  rates climb to attract repayment and fresh liquidity.
* **Variable interest rate.** The borrow rate is set by the rate model and moves with utilization.
  Interest accrues to your debt continuously.
* **Swap fee: 0.25%.** Charged on swaps routed through the pool.

Both **RWT** and **stRWT** can be used as collateral and borrowed against each other.