# Role of Liquidation

### Main Role of Liquidation

When collateral value declines excessively or base asset value rises, and the borrower cannot properly manage their position,

liquidation prevents the borrower from defaulting and causing losses to the entire protocol, protecting other users.

It also minimizes losses to borrowers due to declining collateral value.

This function allows the protocol to maintain sustainable operations

and provide users with a safe environment.

### Avoiding Liquidation

When collateral value declines excessively or base asset value rises,

borrowers can avoid liquidation by adjusting their position, such as increasing the amount of collateral assets deposited into the protocol

or repaying base asset borrows.


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