In such cases, to liquidate the locked tokens, a third-party liquidator gains access to the deposit. His job is to trade the locked tokens to the one in which the debt is taken. He then pays back the debt on behalf of the borrower, gaining a liquidation bonus in the process. Since there are many token pair combinations (the ones you have to liquidate vs. the ones you have to pay back), the liquidators must have much liquidity in multiple fluctuating assets to make the swaps, which leads to a lot of inventory risk. For flash loans, liquidators do not need to hold any of these volatile stocks. They could flash borrow from one of the major platforms, payback on behalf of the borrower, release its deposit, swap it for the token in which the flash loan is taken, pay back the flash loan and gain the bonus. This description of the complex transaction gives the illusion that the liquidator must undertake multiple steps; in reality, all the steps are done automatically by the flash loan smart contract. The flash loans could be used to protect the assets' value in the deposit since a market fluctuation could endanger your deposit by potentially triggering a liquidation process, which would lead to 3%-15% penalties. Using a flash loan smart contract can protect in the case of such liquidations since for flash loans, the fees are either 0 or 0.09%, much better than 3-15%.