Settlement of Debt

All trades on Arbitrum are settled using USDx. If you use other collateral types than USDx, you can accrue Debt.

When your balance is in debt (i.e., negative PNL), you are unable to withdraw any collateral. However, Total Collateral, Free Collateral, and Buying Power are unaffected. To enable withdrawals again, you’ll need to pay down your debt balance.

Debt is only accrued when alternative non USDx collateral types are provided as margin!

Withdrawals are locked while debt is owed

Ways to Settle Debt

Settlement of debt can be completed multuple ways

• Settle with Collateral - This settlement strategy will liquidate enough of an non USDx collateral type to repay any negative debt and unlock the remainder for withdrawal.

Note that debt settled via alternate provided collateral types will sell the necessary amount of collateral in the system to settle and outstanding debt.

• Settle with USDx - This settlement type will use USDx outside of the perps account to repay any debt owed to the system.

If the trader has USDx in their perps account the system will automatically use the USDx to settle debt as it accrues.

Unsettled debt can cause liquidation of collateral in the account if debt exists. Traders are encouraged to settle debt to avoid their provided collateral from being liquidated even if no position is open but their debt owed comes close to being to the value of non stable coin collateral.

Where to get USDx?

USDx can be swapped into via: https://swap.defillama.com/?chain=arbitrum&from=0x0000000000000000000000000000000000000000&tab=swap&to=0xb2F30A7C980f052f02563fb518dcc39e6bf38175