Solera Markets

Solera Summer is officially LIVE🟢 and cooking with @Galxe! We're giving away a $100 bounty each to 3 random winners who complete the quest and claim the "Solera Soldier" role in our Discord. Here's what you need to do👇:

The signal went up. Sergeant Savings is already in position. 🦅 @SoleraMarkets is officially live on @plumenetwork Alpha! Alpha is online. Genesis is the next operation. Goons in control.🪶

Understanding Liquidation Thresholds and Loan-to-Value Ratios What is the Liquidation Threshold (LT)? The Liquidation Threshold (LT) represents the critical point at which a loan becomes undercollateralized, putting your position at risk of liquidation. If your collateral value falls below this threshold, your position can be closed by liquidators on the network, who will repay your debt to lenders. Example: With an LT of 80%, liquidation occurs when your collateral value drops to less than 80% of your loan amount. What is the Loan-to-Value Ratio (LTV)? The Loan-to-Value ratio (LTV) defines the maximum amount you can borrow against your collateral, expressed as a percentage of the collateral's total value. In simple terms: LTV represents your maximum borrowing power. Key Differences The primary distinction lies in risk management: LTV tells you how much you can borrow initially LT indicates when you risk losing your collateral to liquidation For example: If the maximum LTV is 75% and the LT is 80%, you can borrow up to 75% of your collateral's value. Your position remains safe as long as your loan stays below 80% of the collateral's value. Why the Difference Between LTV and LT? LTV is typically set lower than LT to create a safety buffer. This margin accounts for market fluctuations and interest accrual, helping borrowers avoid immediate liquidation if they use their full borrowing power. Important: Always monitor these levels on your outstanding loans to avoid liquidation!