> For the complete documentation index, see [llms.txt](https://cryndex-labs.gitbook.io/cryndex-docs/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://cryndex-labs.gitbook.io/cryndex-docs/liquidations.md). # Liquidations Liquidations occur when a borrower's health factor drops below 1. When this occurs, a liquidator can pay back 50% of the borrower's debt and receive a 1:1 USD value ratio of the borrower's collateral plus a liquidation bonus to incentivise liquidators. Liquidations are necessary in order to make sure that all Cryndex Assets are at a minimum collateralised 1:1 to their USD value collateral. A health factor above 1 represents a position that is above the liquidation threshold. Regular monitoring is essential, as the health factor fluctuates based on both the value of collateral and borrowed assets. To improve the health factor, users can either supply more collateral or repay part of the borrow position. The health factor is directly tied to collateral value. If the value rises, the health factor improves; if it falls, the health factor declines, increasing the risk of liquidation. --- # Agent Instructions This documentation is published with GitBook. GitBook is the documentation platform designed so that both humans and AI agents can read, navigate, and reason over technical content effectively. Learn more at gitbook.com. ## Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter, and the optional `goal` query parameter: ``` GET https://cryndex-labs.gitbook.io/cryndex-docs/liquidations.md?ask=&goal= ``` `ask` is the immediate question: it should be specific, self-contained, and written in natural language. `goal` is optional and describes the broader end goal you are ultimately trying to accomplish on behalf of the user. GitBook uses it to tailor the answer towards what is most useful for that goal. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.