Tarot uses the Tarot Price Oracle to reliably calculate the value of LP tokens and determine how much collateral is necessary for borrowing and leverage.
Tarot Price Oracle works with any Uniswap V2-compatible token pair, commonly supported by DEXs. It calculates the time-weighted average price (TWAP) by using the pair’s built-in price accumulators, over a period of at least 1,200 seconds (20 minutes). This is accomplished using the pair’s current price and a previously-observed price (stored within the oracle’s contract) from at least 20 minutes prior.
More information on the Tarot Price Oracle and pricing LP tokens can be found on Medium: