# Tokens
The Loan Vault, flrEUR, and FFM tokens will ultimately be freely tradable. However, we will only actively seek to maintain liquidity (and a 1:1 peg to the EUR) for the flrEUR token, which acts as the unit of account and currency of the protocol.
Loan Vault and flrEUR tokens will, in principle, be 100% backed by performing loan assets (collateral) and accrued interest. Florence Finance will have a legal title (possibly subordinated/junior) to the underlying loan/collateral and act as a real-world agent (Delegate) in bankruptcy remote structures to protect such assets in the event of a default of the underlying lending platform/customer. The Platform will hold records of available collateral, and risk measuring/monitoring metrics will be shared on the platform in real-time.
Due to the nature of the underlying collateral and contrary to most existing DeFi protocols today, in the event of a default on a loan, it will not be automatically dealt with by an AMM. Instead, it will be resolved in the real world by Florence Finance Europe BV (the Delegate), and the Loan Vault principal value will be “adjusted” to estimated proceeds from liquidation/resolution and/or covered by first loss provisions on the platform. The eventual proceeds from the real-world liquidation will be added back to the Loan Vault or first loss provision, as the case may be.
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