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  • 👋Welcome
  • Introduction
    • About Granite
    • Key Benefits
    • Stacks and sBTC
      • Stacks
      • sBTC
    • Audits and Bug Bounties
    • Quick Links
  • Core Protocol Features
    • Getting Started
      • Wallet Setup
      • Connecting to Granite
      • Assets
      • Bridging aeUSDC
      • Network Selection
      • Security Tips
    • Borrowing
      • How to Borrow
      • Managing Your Position
      • Liquidations
      • Position Monitoring & Alerts
    • Liquidity Provisioning
      • How to Supply
      • How to Withdraw
      • Interest Rate Model
  • Protocol Mechanics
    • Isolated Markets
      • Single Asset Pools
      • Benefits
    • No Rehypothecation
    • Interest Rates
      • Utilization Rate
      • Rate Calculation
      • Market Dynamics
    • Safety Mechanism
      • Risk Parameters
      • Protocol Reserve
      • Safety Module
    • Oracle Implementation
  • Protocol Information
    • Audits
    • Contracts
  • Additional Resources
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  1. Protocol Mechanics
  2. Isolated Markets

Benefits

The isolated market model offers several key benefits:

  1. No Rehypothecation: When users deposit collateral, it remains theirs. Granite never lends it out to other users, ensuring that assets are always available when needed. This eliminates the liquidity risk that borrowers face in traditional DeFi models where their collateral might be lent out without their knowledge.

  2. Independent Liquidity: Each isolated market does not share liquidity with others, allowing for tailored risk profiles. This independence enables more precise risk management and increased flexibility in market parameters.

  3. Customizable Parameters: Each market has its own set of risk parameters, including its own Max and Liquidation LTVs, Interest Rate Model, and Oracle. This customization allows Granite to provide a more secure and user-friendly experience.

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Last updated 4 months ago