> For the complete documentation index, see [llms.txt](https://docs.3adao.org/3a-protocol/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.3adao.org/3a-protocol/protocol-documentation/lending/liquidation/community-liquidations.md).

# Community Liquidations

In the event that the Stability Pool runs out of funds and the Dutch Auction is canceled, the collateral is sold on the spot market by the 3A DAO, and the EURO3 proceeds are used to pay the debt in the Vault. 

If there’s a surplus, the remaining EURO3 is sent to the cashback pool. If there’s a deficit, the unpaid debt is automatically distributed over the remaining Vaults, proportionally to the existing debt in the Vaults.


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