Collateral Liquidation Profits

Our collateral liquidation profits mechanism ensures that holders of btcUSD are entitled to a share of the profits generated from the liquidation of collateralized BTCB tokens. This feature is triggered when the collateralization ratio of a user's btcUSD falls below the minimum requirement of 120%. In such cases, the collateralized BTCB tokens are liquidated to maintain the stability of the btcUSD token.

When a collateral liquidation occurs, the profits generated from the sale of the collateralized BTCB tokens are distributed among the holders of btcUSD, providing an additional incentive for users to hold the stablecoin. This feature encourages users to participate in the ecosystem and helps to ensure the long-term stability of the btcUSD token.