# Resolv Collateral Pool

To back the stablecoin, a collateral pool is allocated into crypto money market instruments. Key features of the collateral pool strategy are:

* ETH and BTC price fluctuation against USD is fully hedged with [perpetual futures](https://docs.resolv.xyz/litepaper/useful-definitions/perpetual-futures) to form a [delta-neutral portfolio](https://docs.resolv.xyz/litepaper/useful-definitions/delta-neutral-portfolio).
* USD-neutral assets allocated into DeFi asset clusters.
* The majority of collateral is held directly on-chain. A portion of collateral is held in institutional custody as margin for futures.

For details on collateral management, see Protocol Mechanics - [collateral-pool](https://docs.resolv.xyz/litepaper/protocol-mechanics/collateral-pool "mention") section.