diff --git a/x/cdp/keeper/cdp.go b/x/cdp/keeper/cdp.go
index ee364e82..72e99dba 100644
--- a/x/cdp/keeper/cdp.go
+++ b/x/cdp/keeper/cdp.go
@@ -350,6 +350,9 @@ func (k Keeper) ValidateCollateral(ctx sdk.Context, collateral sdk.Coin, collate
 	if !found {
 		return sdkerrors.Wrap(types.ErrCollateralNotSupported, collateral.Denom)
 	}
+	if cp.Denom != collateral.Denom {
+		return sdkerrors.Wrapf(types.ErrInvalidCollateral, "collateral type: %s expected denom: %s got: %s", collateralType, cp.Denom, collateral.Denom)
+	}
 	ok := k.GetMarketStatus(ctx, cp.SpotMarketID)
 	if !ok {
 		return sdkerrors.Wrap(types.ErrPricefeedDown, collateral.Denom)
diff --git a/x/cdp/keeper/cdp_test.go b/x/cdp/keeper/cdp_test.go
index 0bd0139e..e3c754e6 100644
--- a/x/cdp/keeper/cdp_test.go
+++ b/x/cdp/keeper/cdp_test.go
@@ -47,7 +47,9 @@ func (suite *CdpTestSuite) TestAddCdp() {
 	acc := ak.NewAccountWithAddress(suite.ctx, addrs[0])
 	acc.SetCoins(cs(c("xrp", 200000000), c("btc", 500000000)))
 	ak.SetAccount(suite.ctx, acc)
-	err := suite.keeper.AddCdp(suite.ctx, addrs[0], c("xrp", 200000000), c("usdx", 26000000), "xrp-a")
+	err := suite.keeper.AddCdp(suite.ctx, addrs[0], c("xrp", 200000000), c("usdx", 10000000), "btc-a")
+	suite.Require().True(errors.Is(err, types.ErrInvalidCollateral))
+	err = suite.keeper.AddCdp(suite.ctx, addrs[0], c("xrp", 200000000), c("usdx", 26000000), "xrp-a")
 	suite.Require().True(errors.Is(err, types.ErrInvalidCollateralRatio))
 	err = suite.keeper.AddCdp(suite.ctx, addrs[0], c("xrp", 500000000), c("usdx", 26000000), "xrp-a")
 	suite.Error(err) // insufficient balance
diff --git a/x/cdp/types/errors.go b/x/cdp/types/errors.go
index d28416bf..dec900da 100644
--- a/x/cdp/types/errors.go
+++ b/x/cdp/types/errors.go
@@ -43,4 +43,6 @@ var (
 	ErrDenomPrefixNotFound = sdkerrors.Register(ModuleName, 18, "denom prefix not found")
 	// ErrPricefeedDown error for when a price for the input denom is not found
 	ErrPricefeedDown = sdkerrors.Register(ModuleName, 19, "no price found for collateral")
+	// ErrInvalidCollateral error for when the input collateral denom does not match the expected collateral denom
+	ErrInvalidCollateral = sdkerrors.Register(ModuleName, 20, "invalid collateral for input collateral type")
 )