# Collateralization Ratio

**Overview**

This indicator monitors the total debt in Curve’s crvUSD markets incurred by the mining of crvUSD to Curve's deposits used as collateral backing it. It ensures that crvUSD is overcollateralized at all times to sustain its intended $1 peg.

The indicator is calculated as the ratio of the number of crvUSD tokens minted from the protocol to the total value of Curve's deposits (in USD) used as collateral backing it.

**How can I use it?**

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Monitoring this ratio is essential to maintain the stability and credibility of crvUSD. If the collateralization falls below a certain level, it could threaten the $1 peg, leading to loss of trust and potential market disruptions. Maintaining overcollateralization is key to ensuring stability and integrity in the associated ecosystem.

The stablecoin industry often requires collateralization to ensure that tokens maintain a stable value. In the case of crvUSD, keeping track of the overcollateralization ensures that the token continues to sustain its intended $1 peg, making this indicator an essential tool for risk management and operational oversight.


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