Collateral, Loan Amount, and LTV
Three numbers are linked: the amount you borrow, the collateral you post, and your loan-to-value (LTV) ratio. Fix any two and the third is determined.
The formula
Required collateral value = (Loan amount + fees) ÷ LTV. For a $40,000 loan at 40% LTV, the fees are $800.30 (the 2% origination fee plus a small network fee), so you need $102,000.75 of BTC. At today's price, that's converted into a specific amount of Bitcoin.
Try It Yourself
Use the calculator to see how the required collateral changes as you adjust the loan amount and LTV. A lower LTV asks for more collateral but gives you a larger safety buffer.
How much do you want to borrow?
Liquidation Price
BTC price at which your loan may be liquidated
APR
Variable interest rate and 2% origination fee
Estimated Interest
Accrues on your starting balance. No monthly payments.
- Origination Fee (2%)Added to your loan balance
- $100.00
- Starting Balance
- $5,100.00
- Est. 12-Month Cost
- —
- Loan Term
- 12 Months
Lower LTV, bigger cushion
At 40% LTV, Bitcoin would need to fall a long way before you approach liquidation. Borrowing at the maximum 60% leaves much less room.
How Fees Affect Your Collateral
Your required collateral also covers the loan's costs. The 2% origination fee is financed on top of the amount you request, and a small flat network fee is deducted from the payout — so the collateral is sized to the amount you receive plus fees.
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