> ## Documentation Index
> Fetch the complete documentation index at: https://docs.byzantine.fi/llms.txt
> Use this file to discover all available pages before exploring further.

# What is over-collateralisation?

To borrow \$1 worth of stablecoins, a user must typically lock up \$1.20 - \$1.50 in digital assets as collateral.

The smart contracts monitor asset prices in real-time and if the value of that collateral drops, the system automatically sells part of it to repay lenders before any loss occurs.

This excess-collateral rule is what keeps the system solvent and allows Byzantine Prime to provide credit yield without unsecured counterparty risk.