# Assets

On **Rhombus**, collateral deposited is viewed as an asset since it can be sold to cover the loan amount if necessary. In contrast, borrowed amounts are considered **liabilities** because they represent the borrower’s obligation to repay the lender. The tokens used for assets and liabilities often differ, with borrowed tokens generally being stablecoins, while collateral tokens are usually more volatile.

### Token Evaluation and Listing on Rhombus

A detailed analysis is essential before listing any token on **Rhombus** to minimize potential market risks. The platform follows a set of stringent criteria to assess whether an asset is suitable for inclusion in the lending pool, including:

* **Liquidity Check**: Verifying that the asset has adequate market liquidity to support trading.
* **Security Assessment**: Performing a full audit to uncover potential vulnerabilities in the token's smart contract.
* **Collateralization Strategy**: Establishing a suitable collateralization ratio that balances risk while maintaining the lending pool’s integrity.
* **Risk Assessment**: Prioritizing assets with strong risk profiles to serve as collateral.
* **Oracle Considerations**: Tokens with easily manipulated oracles are restricted to single-borrow listings.
* **Community Support**: Gauging the token’s level of community backing and activity.

#### Isolation Mode for Risky Assets (Not Available now)

For newer or more volatile tokens with lower liquidity, **Isolation Mode** may be used. This feature enables the platform to manage borrowing and lending for riskier assets while keeping exposure controlled.


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