What Happens to the Excess Collateral When a User Burns Over-Collateralized Stablecoins?

When a user burns the stablecoins they previously minted, the underlying collateral is released back to them. If the initial collateralization ratio was 150%, the user receives the full 150% of the collateral they initially locked up, provided the collateral's value has not fallen below the liquidation threshold.

The system only retains the burned stablecoins.