Plain English
LTV (Loan-to-Value) is the ratio of borrowed amount to the value of the collateral securing the loan. Stated as a percentage. If you deposit $100K of collateral and borrow $40K, your LTV is 40%.
How it actually works
Every lending venue has two LTV limits. The max LTV is how much you can borrow against a given collateral type initially. The liquidation LTV is the threshold above which the protocol forcibly sells collateral to repay the loan. If collateral value drops or borrowed value rises, your LTV climbs toward the liquidation threshold.
What it means for you
For members borrowing against crypto, LTV management is the single most consequential operational decision. Higher LTV gets you more borrowing capacity but compresses the buffer against liquidation. The discipline: borrow at a level that survives the worst-case market drop you expect.
Our Crypto-Collateralized Lending pillar walks through LTV strategy in detail — conservative, moderate, and aggressive deployments, and the operational protocols for adjusting LTV as markets move.
Educational content only. Not investment, tax, or legal advice.