Collateral liquidation occurs when your Loan-to-Value (LTV) reaches a critical threshold, known as the Liquidation LTV.

What’s the Threshold?

Your Liquidation LTV is specified in your loan agreement. Currently, it is set at 90%.

Example:

• Loan Amount: $50,000 USD

• Original Collateral Value: $100,000 USD

• Origination LTV: 50%

• Liquidation LTV: 90%

If your collateral drops to $55,555, your LTV reaches 90%, and our system will automatically sell a portion of your crypto to bring your loan back to its original LTV.

How to Avoid Liquidation:

Monitor your LTV regularly and top up your collateral or repay part of your loan when your LTV approaches 80% (Margin Call level).