When it comes to borrowing Thai Baht with crypto, one of the most important concepts every investor should understand before taking out a loan is LTV. This ratio not only determines how much you are eligible to borrow, but also reflects the overall risk level of the loan itself. Understanding LTV correctly is essential for using a crypto-backed loan effectively and safely.
What Is LTV (Loan-to-Value)
LTV (Loan-to-Value) is the ratio between:
- The value of your collateral asset (cryptocurrency), and
- The amount of Thai Baht you borrow
Example
If you hold BTC worth 100,000 THB and borrow 40,000 THB,
the LTV of this contract is 40%.
LTV acts as a borrowing ceiling, defining how much liquidity you can unlock from the crypto you already own.
Why LTV Matters in Crypto-Backed Loans
1. Determines the Maximum Borrowing Amount
A higher LTV allows access to a greater borrowing limit. For example, LTV 60% offers more liquidity than LTV 30%, enabling more flexible financial planning and cash flow management.
2. Indicates the Risk Level
LTV is directly related to risk.
| LTV Level | Risk Impact |
| High LTV | Higher risk because even small price drops may affect the contract quickly |
| Low LTV | Lower risk with a larger buffer to absorb market volatility |
3. Reduces the Risk of Liquidation
During periods of high volatility, a rapid decline in crypto prices can cause the LTV to rise beyond the threshold, potentially triggering liquidation. Choosing the right LTV level helps minimize this risk significantly.
High LTV vs Low LTV: Which Is Better
| Type | Overview |
| High LTV | More liquidity but requires active monitoring due to higher liquidation risk |
| Low LTV | Safer and more stable, suitable for volatile markets or conservative investors |
How LTV Works on Liberix
To support accurate evaluation and secure loan management, Liberix provides a transparent and flexible LTV system with key features:
- Multiple LTV options typically ranging from 30% to 60%, allowing users to adjust based on personal risk tolerance
- Real-time asset valuation to determine accurate borrowing limits
- Automated notifications when collateral approaches the risk level
- Institutional-grade custody protection using Cold Storage through trusted Custodian partners
This enables users to borrow Thai Baht confidently and securely while maintaining long-term upside potential of their digital assets.
Tips for Choosing the Right LTV
| Market Condition | Recommended LTV | Reason |
| Sideways market | Medium LTV | Balances liquidity and safety |
| Highly volatile market | Low LTV | Reduces risk of liquidation |
| Need high liquidity | High LTV | More capital access but requires close monitoring |
