Once these assets are supplied, you can borrow based on the collateral ratio of the asset. Typically collateral ratios are set anywhere from 35% to 90%. For example, if Bitcoin has a collateral value of 90%, that means you can borrow up to 90% of the value of your BTC. If the user has $100,000 in BTC supplied to the ABC protocol, that means they can borrow up to 90% of the value. However, if a user’s collateral value drops below 90%, or whichever collateral ratio percentage that a certain asset has, it could cause a Liquidation event, which will be discussed later.