# Understanding Collateral

Collateral in Beraborrow is an asset that a borrower pledges to secure a loan. Beraborrow’s Dens support a variety of collateral types, including liquid staking tokens like `$iBGT` and `$iBERA`, as well as other whitelisted assets such as LP positions from Bex and Berps. 

### **Loan duration** <a href="#loan-duration" id="loan-duration"></a>

Loans issued by the protocol do not have a repayment schedule. Debt can be repaid at any time.

### Multiple Collateral Types

The inclusion of multiple collateral assets into Beraborrow enables users to maintain exposure to several assets, while freeing up liquidity for use across the Berachain DeFi ecosystem. This diversification helps insulate $NECT from fluctuations in the value of individual collateral types, ensuring greater stability within the protocol. Simply put, more collateral means a more resilient $NECT.

By accepting multiple assets as collateral, our platform enables leverage across a diverse range of tokens. This flexibility allows users to maximize exposure through recursive borrowing and lending, expanding opportunities for leveraged positions.

#### Where does this collateral sit?

Each depositor will have their own DEN, which represents your position on a certain collateral type (e.g. `$iBGT`) and is linked to your Berachain address.

They maintain 2 balances, your collateral balance and the `$NECT` debt balance.\
Both of these balances are adjustable via repayments, collateral additions and removals... as long as the LTV (Loan To Value) doesn't descend over [critical amounts](/docs/borrowing/collateral-ratio-and-liquidation.md).

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