Penalty ratio is used to determine the maximum amount of USDJ bought and destroyed in liquidation auctions. The remaining collateral assets after the CDP liquidation will be refunded to the CDP holders before the liquidation. Penalty ratio is used to improve the efficiency of the liquidation mechanism, and the liquidation penalty will be used to buy and burn PTRX, increasing the amount of TRX that can be converted from PTRX.
What is penalty ratio?
