---
description: >-
  Borrowing operations and portfolio management strategies in the Polkadot
  ecosystem.
---

# Borrowing

Borrowing tokens is an important component of Decentralised Finance (DeFi) operations and a very popular feature of Decentralised exchanges (DEXes). Borrowing protocols empower users to [leverage their existing assets](borrowing) to increase the overall value of their portfolio during market movements.

In the Polkadot ecosystem, this constant spread of value across parachains and external ecosystems is optimised by novel [clearing house mechanisms](borrowing/liquidation) which assist borrowers in defining their strategies.&#x20;

<figure><img src="https://2458985513-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FL6ALv1GyPrgErCsK1L2I%2Fuploads%2Fvbq0kcR87Wt3671wxlZv%2FO_BorrowingXCMP.JPG?alt=media&#x26;token=ded80877-ed49-4bf2-bfa8-0e52c6bb94df" alt="A view of how XCMP interconnects Parachains offering DeFi services in the Polkadot ecosystem."><figcaption><p>The Polkadot Relay chain has onboarded more than 12 <a href="https://polkadot.network/blog/a-year-in-parachains-part-1-defi">DeFi parachains </a>in its ecosystem.</p></figcaption></figure>

