What is Collateral ratio?

A Collateral ratio is an indicator representing the size of collateral compared to the value of a loan.

Based on the 70% of LTV which is a fixed rate for all DAG loans, the Collateral ratio is automatically set at 142.86% when a loan is first granted. It decreases as the market price of collateral decreases or when the value of loan increases. DAG signals users a warning for expected partial liquidation when the Collateral ratio drops to 135%. A partial liquidation of collateral is automatically executed when the ratio reaches 125% (Liquidation ratio).