# 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](/litepaper/useful-definitions/perpetual-futures.md) to form a [delta-neutral portfolio](/litepaper/useful-definitions/delta-neutral-portfolio.md).
* 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](/litepaper/protocol-mechanics/collateral-pool.md) section.


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