Collateral ratio

Collateral ratio (C-ratio) is the position-health number in any lending or CDP protocol. It is simply:

ratio = collateral value / debt size

A ratio of 2.0 means collateral is twice the debt. A ratio of 1.33 means only one-third more. At 1.0, collateral equals debt — the position is technically underwater and gets liquidated.

Relation to LTV

LTV (Loan-to-Value) is the percentage inverse:

LTV = 1 / ratio = debt / collateral

Ratio 1.67 → LTV 60%. Ratio 1.33 → LTV 75%. Protocols typically display LTV rather than ratio because the cap is more intuitive (“not above 70%”).

Threshold levels

Every protocol publishes a few levels:

• Max LTV / open ratio — the cap at which you can open. On TON in EVAA, usually 70–75% for TON collateral.
• Liquidation threshold — sits 5–10 pp above max LTV; positions can be liquidated past it.
• Health factor = liquidation_threshold / current_LTV. HF below 1 = liquidatable.

Example: max LTV 70%, threshold 80%, current LTV 60%. HF = 80 / 60 = 1.33 — that is your buffer.

How it moves

• Collateral price up → ratio improves (HF up).
• Collateral price down → ratio worsens (HF down).
• Debt grows (accrued interest) → ratio worsens too.

In perpetuals the equivalent metric is margin ratio or maintenance margin — same concept under a different name.

Practical management

• Open with a 1.5–2x buffer above the threshold to absorb volatility.
• Top up collateral when approaching the risk zone.
• For long-running positions in volatile assets, set health-factor alerts or use management bots.
• Remember: the value is computed at the oracle’s price, which can drift slightly from spot.

Collateral ratio is the primary dashboard for your position. Once it sits at the edge, the only outcomes are liquidation or manual intervention.