🛡️ Protection Strategies: Stay Safe
Discover overcollateralization, alerts, and repayment tactics
Your Progress
0 / 5 completed🛡️ Liquidation Protection Strategies
The best defense against liquidation is proactive risk management. Let's explore proven strategies to protect your positions.
🎮 Interactive: Strategy Comparison
Explore different approaches to liquidation protection:
🛡️
Conservative Positioning
Maintain low LTV ratios and high health factors for maximum safety
Effectiveness
Very High
Key Tactics
- • Keep LTV below 40% (HF {">"}2.0)
- • Only borrow with stable assets as collateral
- • Leave 50%+ buffer room
- • Use stablecoin pairs when possible
✓ Pros
- • Maximum safety margin
- • Can survive extreme volatility
- • Peace of mind
✗ Cons
- • Lower capital efficiency
- • Less leverage
- • Opportunity cost
Emergency Response Plan
1️⃣
When HF Drops Below 1.5
This is your warning zone. Take immediate preventive action before liquidation becomes imminent.
Actions
- • Add more collateral (fastest option)
- • Repay part of your debt
- • Reduce exposure in other positions
- • Set up automation if not already done
2️⃣
When HF Drops Below 1.2
Critical zone. You have very little time before liquidation. Act within minutes, not hours.
Urgent Actions
- • Immediately add collateral (priority #1)
- • Use fast transactions (high gas if needed)
- • Close position entirely if necessary
- • Don't wait—bots are already watching
3️⃣
When HF Drops Below 1.0
Liquidation in progress or imminent. Your options are extremely limited.
Last Resort
- • Self-liquidate if possible (save penalty)
- • Front-run liquidators with higher gas
- • Accept the loss and learn from it
- • Most likely too late at this point
Tools & Resources
🔔
Monitoring Tools
- •DeFi Saver: Automated position management
- •Instadapp: Smart automation recipes
- •Zapper/Zerion: Portfolio tracking
- •Protocol dashboards: Native monitoring
📊
Analytics Platforms
- •DeFi Llama: Protocol TVL & metrics
- •Dune Analytics: Custom dashboards
- •DeFiPulse: Market data
- •CoinGecko: Price alerts
💡
Golden Rules
- 1.Never max out LTV: Leave at least 30-40% buffer
- 2.Set alerts early: Get warned at HF 1.8, not 1.1
- 3.Keep emergency funds: Have assets ready to add quickly
- 4.Understand your assets: Know liquidation thresholds before borrowing
- 5.Test with small amounts: Practice before scaling up