Aave Liquidation Penalty vs Guardian Rescue
See exactly how much you save by using Guardian Rescue instead of letting your position get liquidated.
The Liquidation Penalty
When your Aave position is liquidated, you pay a 5-10% penalty in the form of a liquidation bonus to the liquidator. For a $10,000 position, that's $500-$1,000 lost. This is in addition to any losses from the price movement that triggered the liquidation.
The Guardian Rescue Fee
Guardian Rescue charges a flat 2.5% fee cap (250 bps), charged only on successful execution. For that same $10,000 position, the maximum fee is $250 — less than half the minimum liquidation penalty. The fee covers the flash loan premium, swap costs, and service.
Real-World Example
You borrowed $10,000 USDC against $20,000 ETH. ETH drops 30%, your collateral is $14,000, HF drops to 1.05. If liquidated: you lose $500-$1,000. If Guardian Rescue executes: you pay at most $250. Your remaining collateral ($3,750-$3,500 vs $4,750) is significantly higher.
Why the Difference Matters
The 2.5% fee is a cap, not a guarantee. If market conditions allow a lower fee, you pay less. The liquidation penalty is a minimum — the bonus can be higher in competitive liquidator environments.