Yes but if you were already taking the loan near the max and Bitcoin drops, you have to add more collateral. So what happens when BTC gets the normal 50%+ drops at the end? I find it is going to be tough for people to make up the difference sometimes.
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Yes well that is why they do not give 100% on the BTC.
So in the example, $200K in BTC collateral for a $100K house. If the price drops 50%, then they either be liquidated or they will have to put up more BTC as collateral. The house could have gone up or down but that isnt really part of the equation.
If they have no more BTC, the collateral is taken and the house is still theirs.
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