Lending Mechanics
Loan-to-Value Ratio (LTV)
The ratio of a loan amount to the value of the collateral backing it. An LTV of 50% means you can borrow $50,000 against $100,000 in collateral. Lower LTV = safer loan.
Why Loan-to-Value Ratio (LTV) Matters
Understanding loan-to-value ratio (ltv) is essential for anyone participating in crypto lending or DeFi markets. This concept directly impacts how you evaluate platforms, manage risk, and optimize returns.
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