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Adding Collateral

Deposit tokens from an external address to a Credit Account.

For SDK implementation, see Adding Collateral.

Why

You need to add collateral when:

  • Opening an account - Initial deposit to enable borrowing
  • Improving health factor - Account approaching liquidation threshold
  • Enabling more borrowing - Current collateral limits how much you can borrow

Adding collateral increases your account's total weighted value (TWV), which improves the health factor and allows larger debt positions.

What

addCollateral transfers tokens from the caller to the Credit Account. On execution:

  1. The Credit Manager calls transferFrom to move tokens from caller to Credit Account
  2. The token is enabled as collateral (if not already enabled)
  3. Quoted tokens are NOT auto-enabled - you must set a quota separately

Important: Approve tokens to the Credit Manager, not the Credit Facade. The Credit Manager is the contract that actually executes the transfer.

How

Solidity
import {ICreditFacadeV3Multicall} from "@gearbox-protocol/core-v3/contracts/interfaces/ICreditFacadeV3Multicall.sol";
import {MultiCall} from "@gearbox-protocol/core-v3/contracts/interfaces/ICreditFacadeV3.sol";

address creditFacade;
address creditManager;
address usdc;
address creditAccount;
address owner;

MultiCall[] memory calls = new MultiCall[](1);

// Add 10,000 USDC as collateral
calls[0] = MultiCall({
    target: creditFacade,
    callData: abi.encodeCall(
        ICreditFacadeV3Multicall.addCollateral,
        (usdc, 10_000 * 10**6)
    )
});

// First, approve tokens to Credit Manager (not Facade!)
IERC20(usdc).approve(creditManager, 10_000 * 10**6);

// Execute on existing account
ICreditFacadeV3(creditFacade).multicall(creditAccount, calls);

// Or open new account with collateral
ICreditFacadeV3(creditFacade).openCreditAccount(owner, calls, 0);

Using Permit (No Separate Approval)

For EIP-2612 compatible tokens, avoid the separate approval transaction:

Solidity
// Sign permit off-chain, then use addCollateralWithPermit
calls[0] = MultiCall({
    target: creditFacade,
    callData: abi.encodeCall(
        ICreditFacadeV3Multicall.addCollateralWithPermit,
        (usdc, 10_000 * 10**6, deadline, v, r, s)
    )
});

Gotchas

Approve to Credit Manager, Not Facade

The most common mistake. The Credit Manager executes the transferFrom, so it needs the approval:

Solidity
// CORRECT
IERC20(token).approve(creditManager, amount);

// WRONG - will fail
IERC20(token).approve(creditFacade, amount);

Quoted Tokens Need Quota

Adding a quoted token as collateral does NOT automatically enable it. You must also call updateQuota:

Solidity
MultiCall[] memory calls = new MultiCall[](2);

calls[0] = MultiCall({
    target: creditFacade,
    callData: abi.encodeCall(
        ICreditFacadeV3Multicall.addCollateral,
        (quotedToken, amount)
    )
});

calls[1] = MultiCall({
    target: creditFacade,
    callData: abi.encodeCall(
        ICreditFacadeV3Multicall.updateQuota,
        (quotedToken, int96(quotaAmount), uint96(minQuota))
    )
});

Direct Transfers Don't Enable

Sending tokens directly to a Credit Account (via transfer) does NOT enable them as collateral. You still need a multicall with the proper operation to count them in the health factor.

Invalid Collateral Tokens

Only tokens recognized by the Credit Manager can be used as collateral. Transferring unrecognized tokens to a Credit Account may result in them being stuck (only governance can recover).

Check if a token is valid:

Solidity
// This reverts if token is not valid collateral
uint256 mask = ICreditManagerV3(creditManager).getTokenMaskOrRevert(token);

See Also