> For the complete documentation index, see [llms.txt](https://docs.tydro.com/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.tydro.com/iii.-using-tydro/before-you-start.md). # Before You Start A plain-language guide to using Tydro. Read this to understand the basics, then follow the links for detail. ## Using Tydro Tydro does two things: earn interest by supplying an asset, or borrow an asset by putting up collateral. Those are the two core actions, and the rest of this guide fills in the detail. ### Before you start Using Tydro takes a wallet connected to the Ink network with some assets in it. * **Wallets:** any EVM-compatible wallet, such as MetaMask, Coinbase Wallet, or WalletConnect. For Bitcoin-native flows, Leather and Xverse are supported. * **Bridging onto Ink:** Bungee, Super Bridge, the USDT0 Native Bridge, and the Aave Bridge. ### Earn by supplying Supplying is lending. An asset deposited into a market is lent out, and borrowers pay interest for the use of it. * Interest accrues for as long as the deposit stays in the market. * The supply rate moves with demand. More borrowing means a higher supply rate. * The deposit is not locked. It can be withdrawn whenever the market has free liquidity. How much a deposit earns depends on how much is being borrowed. See Interest rates. ### Borrow against collateral Borrowing raises liquidity without selling what is held. Post collateral, then borrow another asset against it. In the first market, that means posting kBTC and borrowing USDC — dollars to use without selling the bitcoin. A few things to know: * Borrowing is capped at a limit, set as a percentage of the collateral's value. This is the loan-to-value, or LTV. * In the launch market the borrow rate is fixed. It is set for the market and does not climb as utilization rises. * Interest accrues on the borrowed amount and adds to the debt over time. * There is no repayment schedule. The loan has no maturity date, so it can be repaid at any time, as long as the position stays healthy. ### Keep the position healthy Every borrow position has a health factor, a safety gauge for the position. * Above 1, the position is fine. * At 1 or below, the position can be liquidated. Two things push the gauge down: collateral dropping in value, and interest building up on the debt. To push it back up, add more collateral or repay some of what is owed. {% hint style="warning" %} Watch the health factor. If collateral falls in value, the gauge drops, and collateral can be lost to liquidation. {% endhint %} ### Repay and withdraw To close a position, repay the borrowed amount plus interest, then withdraw the collateral. This can also be done in parts: repay some debt to free up borrowing room, or withdraw spare collateral while keeping the position open. ### If a position gets liquidated If the health factor hits 1 or below, a liquidator can step in, repay part of the debt, and take an equal value of collateral plus a small bonus. This brings the position back above 1 and keeps the market solvent. The borrowed asset is kept, but the collateral that was used is lost. The way to avoid it is to keep the health factor well above 1. ### Where to go next * The mechanics behind all of this: How lending and borrowing work. * The market in use: [Isolated Markets](/ii.-core-concepts/markets/isolated-markets.md). * The risks worth understanding first: [Risk Parameters](/ii.-core-concepts/risk-paramaters.md) and [Disclosures](/v.-risk/disclosures.md). --- # Agent Instructions This documentation is published with GitBook. GitBook is the documentation platform designed so that both humans and AI agents can read, navigate, and reason over technical content effectively. Learn more at gitbook.com. ## Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter, and the optional `goal` query parameter: ``` GET https://docs.tydro.com/iii.-using-tydro/before-you-start.md?ask=&goal= ``` `ask` is the immediate question: it should be specific, self-contained, and written in natural language. `goal` is optional and describes the broader end goal you are ultimately trying to accomplish on behalf of the user. GitBook uses it to tailor the answer towards what is most useful for that goal. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.