> For the complete documentation index, see [llms.txt](https://docs.revert.finance/revert/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.revert.finance/revert/aerodrome/staked-lp-as-collateral.md).

# Using staked positions as collateral

Aerodrome positions staked through Revert can be used as collateral in [Revert Lend](/revert/revert-lend.md) on Base. The position stays staked in its gauge for the entire life of the loan, so it keeps earning AERO emissions while it backs your debt.

![Aerodrome position with an active USDC loan on Revert Lend](/files/FboGuyTbz6en8hrEWYF9)

## How it works

1. Deposit the position into the Revert Lend vault and borrow against it, in a single step. Borrowed tokens are issued in the vault's lending asset, USDC. See [Borrowing](/revert/revert-lend/borrowing.md).
2. The vault keeps the position staked through Revert's [GaugeManager](/revert/aerodrome/staking-and-rewards.md). AERO emissions continue to accrue to you while the position is locked as collateral.
3. Your borrowing power is determined by the position's value and the lower of the two assets' collateral factors, the same as any other Lend collateral.
4. You can claim AERO or [auto-compound](/revert/aerodrome/aero-auto-compounding.md) it while the loan is open. Compounded rewards grow the position, which grows your collateral value.

## What your collateral earns

While staked in an Aerodrome gauge, a position earns AERO emissions instead of swap fees: trading fees generated by staked liquidity go to veAERO voters. The yield on your collateral is therefore the position's rewards APR, not a fee APR. If you unstake, the position earns swap fees again and stops receiving emissions. A position never earns both at once.

## The carry

Borrowing against a productive position is a spread trade. Your collateral earns the rewards APR while your debt accrues the borrow rate, and the loop only works while the first exceeds the second.

For illustration: a $10,000 staked position at a 40% rewards APR accrues about $11 per day in AERO. Borrowing $5,000 against it at a 15% borrow rate accrues about $2 per day in interest. That carry is not fixed:

* Emissions are re-voted every weekly epoch, and their dollar value moves with the AERO price.
* The borrow rate floats with utilization of the lending pool.

A position that is positive carry today can turn negative without any price movement in your pool. Check both legs, not just the rewards side.

## Levering the position

The carry can be levered: borrow USDC against the staked position, swap it to the pool's tokens, add them back to the same position, and restake. Revert executes the whole loop, including the unstake and restake around it, in a single transaction. The result is a larger staked position earning emissions on borrowed capital, with debt interest accruing until the loop is unwound. See [Leverage](/revert/revert-lend/leverage.md) for the general mechanics.

![Leverage loop for staked Aerodrome positions](/files/i9AHEHgjFd6YJU2YIOgq)

Leverage scales both legs of the carry and shrinks the distance to liquidation. The risks below apply with more force, not less.

## Liquidation

Staked collateral follows the same health rules as any Lend position: if the debt exceeds the collateral value, the loan becomes liquidatable. See [Liquidations](/revert/revert-lend/liquidations.md).

Two details are specific to staked positions:

* The vault unstakes the position as part of the liquidation.
* AERO accrued and unclaimed up to that point is claimed and sent to you, the borrower. It is not part of what the liquidator receives.

The liquidation penalty of 2% to 10% of the debt applies as usual.

## Risks

* **Liquidation risk.** Your collateral is an LP position: its value moves with the pool's prices and with divergence loss. Leverage on top of LP exposure concentrates outcomes in both directions.
* **Floating borrow rate.** Interest accrues continuously and the rate is not fixed. Rising utilization raises your cost of carry.
* **Reward-token risk.** The earning leg is denominated in AERO. A falling AERO price reduces your rewards APR in dollar terms even if emissions are unchanged.
* **Epoch variability.** Gauge emissions depend on weekly veAERO votes. The rewards APR you see today is not a commitment.