Below are three numbers on the Flux’s main page: Total Deposit, Collateralization Rate, Total Loan, where Collateralization Rate = Total Deposit / Total Loan
When the Collateralization Rate marked in green is smaller than 110%, the liquidation auction will be triggered, and all information of the user’s asset will be shown in the liquidation page. At this moment, if someone participates in the auction, the total asset of the user will change according to the change of assets in the auction; if no one participates, the total asset will not change. Taking the 110% liquidation auction collateralization rate as an example, assuming the lent assets have no change in value, the maximum loss of the user will be 9.09% of the total deposit. (After liquidation, the lent assets do not require a return, meanwhile the property right of all the assets will be transferred to the liquidator)
When the Collateralization Rate marked in green is smaller than 102%, the Liquidation Wearing will be triggered, and the Flux liquidation bot will involve to sell all assets of the user in the market price timingly. (After liquidation, the lent assets do not require a return)
Remark: Flux originally designed the 110% indifferent Liquidation Auction Collateralization Rate to benefit the borrowers to the maximum, improve the asset utilization efficiency, and protect the asset of the users.