A Loan Vault is a feature used in decentralized finance (DeFi) platforms, allowing users to deposit collateral and secure a loan. This system enables individuals to borrow funds without needing to sell their assets.When a user deposits cryptocurrency into a Loan Vault, they can borrow a portion of its value in another digital currency. The loan amount is typically less than the collateral’s value to mitigate risk. If the collateral’s value decreases significantly, the platform may liquidate it to cover the loan, protecting lenders.Loan Vaults provide liquidity and accessibility, enabling users to obtain funds for trading or other investments while retaining ownership of their assets. This method supports an efficient and flexible borrowing process, attracting both individual and institutional users. Overall, Loan Vaults enhance financial options, making it easier for users to manage their assets and navigate market opportunities without losing their original investments.