> For the complete documentation index, see [llms.txt](https://fantasm-finance.gitbook.io/fantasm/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://fantasm-finance.gitbook.io/fantasm/mechanisms/collateral-ratio.md).

# Collateral Ratio

Fantastic Protocol is using a Collateral Ratio (CR) for Minting and Redeeming process. There will be a minimum Collateral Ratio which is set by governance.

{% tabs %}
{% tab title="Fantom" %}
The CR is used by the minting and redeeming function and it is displayed as a percentage. This ratio expresses what percentage of FXM token is required to mint or redeem a FTM token. 

{% hint style="info" %}
CR will be adjusted every hour at the step of 0.2% (up or down)

For example:\
▶️ 60min-TWAP over 1.005 FTM -> CR down \
▶️ 60min-TWAP under 0.995 FTM -> CR up\
\
At the beginning, the minimum CR is set at 90%
{% endhint %}
{% endtab %}

{% tab title="Avalanche" %}
The CR is used by the minting and redeeming function and it is displayed as a percentage. This ratio expresses what percentage of SNOWY token is required to mint or redeem a AVAX token. 

{% hint style="info" %}
CR will be adjusted every hour at the step of 0.25% (up or down)

For example:\
▶️ 60min-TWAP over 1.005 FTM -> CR down \
▶️ 60min-TWAP under 0.995 FTM -> CR up\
\
At the beginning, the minimum CR is set at 90%
{% endhint %}
{% endtab %}
{% endtabs %}