One word to know
What is a haircut?
A haircut is the share of an asset's value held back before it counts toward your spending power. The part held back is the cushion that lets a price fall before your spending exceeds what your collateral supports.
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Why is anything held back?
Because prices move. If an asset counted for all of its value, the first fall would leave the drawn balance larger than what backs it.
Why do different assets take different haircuts?
The more an asset moves, the more is held back. Cash takes a small haircut because it holds its value, and a single stock takes a large one because it moves the most.
The shares can change, and none is promised in advance.
USDC
BTC
AAPL
Is a haircut a fee?
No. Nothing is taken from you. The held-back share is still your collateral, and it does not count toward what you can spend.
A haircut is a fee to no one.
Where do you see the haircut?
In the account, before you deposit. What each asset counts for is shown there, and today the rail backs USDC, with other assets counted as the rail adds them.
How does the haircut relate to the required level?
The haircut sets how much of an asset counts. The required level is how much locked collateral has to stand behind what you have drawn. The first applies per asset, the second to the whole account.
Keep what you own. Spend anyway.
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