Safety Model
Safety Rails That Never Sleep
Stackit.ai's safety model is designed to prevent liquidation. The rules engine manages LTV automatically, auto-repays during downturns, and enforces hard limits at the protocol level.
LTV Zones
Loan-to-Value (LTV) measures how much you've borrowed relative to your holdings. Example: $100K in BTC/ETH with $40K borrowed = 40% LTV.
Maximum borrowing flexibility. Comfortable cushion against market volatility. No system action needed.
Normal operating range for borrowing. Most users operate here. The system monitors continuously but takes no defensive action.
Auto-repay begins activating. The system starts repaying portions of the loan to bring LTV back down. No user action required.
Stackit.ai's recommended maximum. At this level, auto-repay is fully active and protection is at its strongest. The underlying lending protocol (currently Aave) allows higher LTV — but Stackit.ai recommends staying at or below 60% for maximum safety.
A note on LTV limits
The underlying lending protocol (currently Aave) supports LTV beyond 60%. Stackit.ai recommends 60% as the ceiling because that's where protection is strongest and the system has the most room to maneuver. You can operate at higher LTV if needed — the system still protects you, it just repays more aggressively. As Stackit.ai adds more lending protocols, the available range may expand further.
Auto-Repay Mechanism
Market drops
LTV rises as holdings lose value relative to borrows.
Auto-repay triggers
System automatically uses your collateral to pay down the loan, reducing LTV. No manual intervention needed.
LTV returns to ~25%
During severe downturns, the target is well inside the Safe Zone.
You keep your crypto
Worst case: less borrowing power. You do NOT lose your BTC or ETH.
Flash loan re-leverage on recovery
When markets recover, Stackit.ai uses flash loans to re-leverage your position back up safely — borrowing, adding collateral, and increasing your position in a single atomic transaction. You participate in the upside without manually rebuilding your position.
Cost of liquidation protection: 0% — always free.
Market Scenarios
Market drops 20%
Before
LTV at 40% (Active Range)
What Happens
System monitors. If LTV rises above 50%, auto-repay begins reducing loan balance.
After
LTV brought back toward ~25%. Holdings preserved. Borrowing capacity reduced temporarily.
Market drops 40%
Before
LTV at 40% (Active Range)
What Happens
Auto-repay triggers aggressively. System repays significant portion of loan to keep LTV under 60%.
After
LTV brought back to ~25%. You keep all your BTC/ETH. Borrowing power significantly reduced until market recovers.
Market rises 30%
Before
LTV at 40% (Active Range)
What Happens
LTV drops naturally as holdings appreciate. No system action needed.
After
LTV at ~31%. Moves into Safe Zone. More borrowing capacity available.
Health Score
The Health Score is a single number (0–100) that shows the overall safety of your treasury at a glance. Higher is better.
80–100
Healthy — plenty of room
50–79
Monitor — system is protecting
<50
Active defense mode
Stackit.ai vs Traditional Crypto Borrowing
Traditional
Stackit.ai
LTV monitoring
Manual — user must watch the market
Automatic — rules engine monitors 24/7
When market drops
Margin call → forced liquidation
Auto-deleverage with collateral → flash loan re-leverage on recovery
Worst case
Lose all crypto holdings
Less borrowing power (keep your crypto)
LTV ceiling
75–85% before liquidation
60% recommended ceiling — higher possible per protocol
3 AM crash
Wake up liquidated
System handled it while you slept
Protection cost
N/A — no protection
0% — always free
Battle-Tested
The rules engine has been refined over 3+ years of real market data, live through 1 full cycle:
2022
bear market crash
2023
recovery
2024–25
bull run
See the safety model in action
Book a free Treasury Design Call. We'll show you exactly how the safety rails protect your position.