For example, assume you buy 1 SOL-PERP long at $100.00, using 1 BTC as collateral. Now assume the oracle drops to $80.00. If no settlements have happened yet on your account, you would show an unsettled balance of -$20.00. If you settle your balance, you will still have your 1 BTC, and your sol-perp position, but it will now borrow $20.00 USDC. Because borrowing costs you money (long-term APR), you could prefer not to settle a negative balance. However remember, anyone with the other side of the position can settle at any time.