# Liquidation and Auction

When the borrower fails to repay the loan within the specified period, the NFT mortgaged by the borrower will be liquidated and an NFT auction will be initiated.

This is a public dynamic automatic markdown auction system.

The auction starts at a starting price, which is 150% of the total accumulated debt.

When the price is between 150% and 130%, the price will be reduced every four hours by 5% of the total accumulated debt.

When the price is between 130% and 100%, the price will be reduced every two hours by 5% of the total accumulated debt.

When the price is between 100% and 70%, the price will be reduced every one hour by 5% of the total accumulated debt.

When the price drops to between 100% and 70%, the treasury may also purchase it. When it reaches 70%, the treasury will directly purchase it if funds are sufficient.

The system follows the principle of "first come, first served.


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