From 1d894a4586ba0a8386cb01efff8cac72e3fb9554 Mon Sep 17 00:00:00 2001
From: toteki <63419657+toteki@users.noreply.github.com>
Date: Sun, 12 Nov 2023 21:10:03 -0700
Subject: [PATCH] fix comments, confirm safety of 1.0 assumed borrow factor for
 unused collateral when under limit

---
 x/leverage/types/position.go      | 1 -
 x/leverage/types/position_test.go | 5 +++--
 2 files changed, 3 insertions(+), 3 deletions(-)

diff --git a/x/leverage/types/position.go b/x/leverage/types/position.go
index 6f10f0933a..771b85ec12 100644
--- a/x/leverage/types/position.go
+++ b/x/leverage/types/position.go
@@ -337,7 +337,6 @@ func (ap *AccountPosition) Limit() sdk.Dec {
 		// borrow limit logic. Borrow factor considers the maximum possible borrow factor,
 		// which if we are not specifying a borrow denom, is 1.0.
 		avgWeight = sdk.OneDec()
-		// TODO: this is an overestimate, which is dangerous when computing liquidation threshold.
 	}
 	borrowFactorLimit := ap.BorrowedValue().Add(unusedCollateralValue.Mul(avgWeight))
 
diff --git a/x/leverage/types/position_test.go b/x/leverage/types/position_test.go
index f7a9b6c2a1..a44992e1e4 100644
--- a/x/leverage/types/position_test.go
+++ b/x/leverage/types/position_test.go
@@ -236,7 +236,7 @@ func TestBorrowLimit(t *testing.T) {
 			"F loop",
 		},
 		{
-			// single asset with unused special pair (borrowFactor reducing weight, minimumBorrowFactor active)
+			// single asset with unused special pair (borrowFactor LT, minimumBorrowFactor active)
 			sdk.NewDecCoins(
 				coin.Dec("FFFF", "100"),
 			),
@@ -245,7 +245,8 @@ func TestBorrowLimit(t *testing.T) {
 			),
 			// 40 A consumes 80 F collateral (weight 0.5 due to MinimumBorrowFactor), leaving 20 F collateral unused.
 			// Total borrow limit and liquidation thresholds are 40 + 20 * 1.0 since borrow limit assumes unused
-			// Collateral can be borrowed by the most efficient possible asset. Actual max borrow will be lower.
+			// collateral can be borrowed by the most efficient possible asset. Actual max borrow will be lower.
+			// Liquidation threshold is capped by borrow factor here, otherwise it would be $65.
 			// The F <-> H special pair has no effect
 			"60.00",
 			"60.00",