Bonq allows users to borrow against their assets without selling them. Users deposit their digital assets, (for example ETH) as collateral to a smart contract called Trove to mint and withdraw BEUR low volatility payment coin. The minimum trove collateral ratio (MCR) depends on the overall collateral risk and varies between 105% and 400%.
There is a Liquidation Reserve of 1 EUR worth of collateral used for liquidation fees
A Trove consists of two balances. One for the collateral asset and the other one for the debt which is denominated in BEUR. There is no minimum debt and there is no deadline to repay the debt as long as the minimum collateralization ratio per asset is maintained. Users can close Troves upon repaying their debts.