Coinbase recently started offering Bitcoin backed loans via a defi platform… I’ll keep saying it to every banker I meet, Bitcoin is the best universal collateral on earth today!
Discussion
Coinbase gives me the heebee jeebees, but what does LTV bellow 86% mean?
Loan to Value ratio
LTV stands for Loan-to-Value ratio
it measures how much you’re borrowing compared to the value of the asset.
If your asset is worth $100,000 & you take out a loan for $86,000, your LTV is 86%
if someone says your LTV is below 86%, it means:
You’re borrowing less than 86% of your assets value, and you have at least 14% equity in the asset
😮 14% drops can happen overnight.
