Generally for loans if the value of the collateral falls below the margin threshold (say 110%) then the collateral will be sold to make sure the lender has no l

Generally for loans if the value of the collateral falls below the margin threshold (say 110%) then the collateral will be sold to make sure the lender has no losses. So it’s very low risk unless Bitcoin goes to zero instantly. Additionally, because the loan is overcollateralized, the borrower can begin to unwind their leverage before they reach the margin threshold and will pay back their loan.