# Liquidations

{% hint style="success" %}
Protects loan repayment
{% endhint %}

Liquidations are not uncommon in trading and DeFi. No true [Degenerate](/degenprime/protocol/double-ds/degenerates.md) hasn't been liquidated at least once. The ability to liquidate is a security measure that ensures that loans can be repaid. On DegenPrime, this is one of the main security measures.&#x20;

The Degenerates in the trenches of AI- and Memecoins are boom or bust. If they go in, they go hard. An unexpected correction, a gradual climb of the price of their borrowed assets, or an all-out market crash, any of these events could push a Degen Account over the brink.&#x20;

As soon as a [Degen Account](/degenprime/degen-account/the-degen-account.md) risks becoming insolvent, liquidation bots step in. These bots constantly monitor DegenPrime's Degen Accounts. If the value of a Degen Account's assets risks dropping below the value of its borrowed funds, part of the positions are liquidated. These liquidated funds are then used to pay back the loan. As it is only a partial liquidation, the Degenerate is still in the game and can keep playing.


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