LTV, or Loan-To-Value, is a financial term used to assess the value of a loan compared to the value of the asset being used as collateral. In this case, the asset is typically cryptocurrency.LTV is calculated by dividing the loan amount by the value of the collateralized cryptocurrency. For example, if you want to borrow $10,000 against an asset worth $20,000, the LTV would be 50% ($10,000 ÷ $20,000). Lenders use LTV to gauge risk; a lower LTV indicates a safer loan for the lender, as there’s more collateral value backing it. Many platforms set specific LTV limits, often ranging from 50% to 80%, based on the volatility of the cryptocurrency involved. If the value of the cryptocurrency drops and the LTV exceeds the agreed limit, borrowers may face liquidation, where the lender sells off part of the collateral to recover their loan amount. Understanding LTV is essential for anyone looking to secure a loan using cryptocurrency as collateral.