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RE: LeoThread 2025-06-24 22:08

in LeoFinance4 months ago

Part 7/9:

The crucial point to keep in mind while using collateralized loans is maintaining your loan's health factor. This number reflects your collateral relative to the amount borrowed. Keeping this above 1.0 is essential; otherwise, the platform could liquidate your holdings. Therefore, prudent management involves not borrowing too aggressively and retaining some excess funds for potential value drops.

In my case, since I borrowed $59,000 at a rate around 4.18%—less than traditional banks—my loan health remained secure. I even deposited extra USDT as a precaution should the value of Bitcoin drop suddenly.

Thinking Long-Term