Drift supports cross-collateral token deposits, specifically: USDC, SOL, BTC and ETH. These can be used for margin within the Perpetuals Markets.
By default, markets are quoted in USD and P&L is settled in USDC. All tokens deposited within the protocol can earn yield via Borrow/Lend. Until unrealised P&L is settled into your Balances, it will not earn (if profits) or be charged (if losses) the deposit/borrow interest respectively.
Below is a table of assets supported by Drift Protocol.
Each asset counts towards margin for derivatives trading and has a weight applied to account for their respective volatilities.
For instance, depositing USDC gives users 1:1 margin for derivatives trading, but depositing SOL (80% asset weight) means that 80% of the value of your SOL at the opening of your position will be available as margin for perpetuals trading.
Initial Asset Weight
Maintenance Asset Weight
Initial Liability Weight
Maintenance Liability Weight
The IMF Factor acts as a discount on account size:
Initial Asset Weight on 2000 SOL Collateral (using above) would be:
weight = min (.80, 1.1 / [ 1 + (0.003 * sqrt(2000)] )
= min(.80, ~.96987) = .80
An asset's liability weight can be converted into an LTV ratio using: ltv = 1 / liability weight