Solvency checks
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Loan repayments
Against
If the health of your Prime Account drops to 0% (as explained ), your account will be deemed insolvent. An insolvent account will be to bring it back to a solvent state. This is mainly dependent on the ratio between borrowed assets and collateral. There are multiple reasons this could occur. A drop in the price of collateral assets, or an increase in the price of borrowed assets are the most frequent reasons for liquidation.
But what happens if you accidentally borrow more than your account can support? Or if you pay so much for slippage it turns your account insolvent? Or what if you accidentally swap too much to an asset with lower borrowing power?
DeltaPrime's solvency checks protect you from accidentally turning your account insolvent. Whenever you initiate a transaction, the protocol automatically checks the solvency of your account post-transaction. Does this leave your account insolvent? Then the transaction is reverted, and it will be like you never initiated the transaction in the first place. In the on-chain explorer, it will show that the transaction was reverted with the following error message:
The action may cause an account to become insolvent
Additionally, borrowing can be done down to a minimum of 10% health. This is done in order to prevent rapid price swings immediately liquidating your newly borrowed position.
