# LP Tokens as Collateral

INIT supports an array of LP tokens (ERC20, ERC721, ERC1155) and yield-bearing assets as collateral to enhance DeFi composability, e.g., mETH (Mantle’s staked ETH), USDY.

In other words, INIT users can continuously earn trading fees and farming rewards from their LP collateral. The Flash Borrow feature enables users to supply their assets to a liquidity pool, and collateralize the LP tokens they obtained within one transaction. Thus, this allows users to borrow against their LP position allowing them to earn while borrowing.

<figure><img src="/files/XRvtxDxWGQkwMnz7Tx03" alt=""><figcaption></figcaption></figure>


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