How does loan to value percentage affect the risk level of cryptocurrency borrowing?

1 answers

• Aaron SantiagoMay 04, 2023 · 2 years ago
  At BYDFi, we understand the importance of the loan to value (LTV) percentage in cryptocurrency borrowing. The LTV ratio directly impacts the risk level for both borrowers and lenders. A higher LTV percentage increases the risk of default and loss for borrowers, as they have less equity in the collateral. It also increases the risk for lenders, as they have a higher chance of not recovering the full loan amount in case of default. Therefore, it's crucial for borrowers to maintain a suitable LTV ratio to mitigate the risk and ensure the safety of their investments. Our platform provides flexible LTV options, allowing borrowers to choose the level that best suits their risk appetite and financial situation.
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