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What is a collateral ratio? A plain explanation

The collateral ratio is the value of what you locked up divided by what you borrowed. It is the number that decides whether a loan stays open.

A simple example

Lock up 200 in value and borrow 100, and the ratio is 200 percent. Lock up 150 and borrow 100, and it is 150 percent. The higher the ratio, the more room the loan has.

Why it changes

The ratio moves whenever the price of the collateral moves, even if you do nothing. That is why a loan that looked comfortable last week can look different today.

Where it matters

Lending systems on PulseChain, such as Liquid Loans, Powercity and INCD, set a minimum. Below it, a loan can be liquidated. Adding collateral or repaying debt happens on each system's own website.

Keeping an eye on it

Pulse Lifeline reads your open loans from a public wallet address and shows each loan's ratio on a card. A detail sheet shows how much collateral to add, or how much debt to repay, to reach a safer level.

Pulse Lifeline does the watching, so the ratio does not need to be on your mind. Open Pulse Lifeline

Related tips

Pulse Lifeline is in testing.

Last reviewed: 2026-11-02

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This page gives general information and is not legal, financial or medical advice. [email protected]