# What is loan-to-value (LTV)?

Loan-to-value compares what you owe with what your collateral is worth. Borrowing $50 against $100 of Bitcoin is an LTV of 50%, and the higher it gets, the closer the loan is to liquidation.

Also called LTV or collateral ratio.

## How Rujira sets the limits

Each coin has a collateral ratio. If Bitcoin’s is 70%, every $100 of Bitcoin lets you borrow up to $70. With several coins as collateral, their adjusted values add up, and a loan stays open as long as that adjusted collateral value stays above the debt. If the adjusted LTV goes above 100%, the position starts to get liquidated.

## What a public wallet gives away

Anyone who sees your collateral and your debt can calculate your LTV, and from it the price at which your loan gets liquidated.

## In Redacted

Borrow from a Redacted private account and the same limits apply, but nobody can tie the loan, its collateral or its liquidation price to your wallet.

More: [Borrow privately](https://redacted.gg/private/borrow/)

## Related terms

- [Liquidation](https://redacted.gg/glossary/liquidation.md): A liquidation sells part of a borrower’s collateral to repay their loan when the collateral is no longer worth enough to cover it safely.
- [Money market](https://redacted.gg/glossary/money-market.md): A money market lets people lend coins to earn interest and lets others borrow them against collateral, with rates that rise as more of a coin is borrowed.
- [Price oracle](https://redacted.gg/glossary/price-oracle.md): A price oracle brings market prices onto a blockchain so that smart contracts can use them, for example to value collateral and decide when a loan gets liquidated.

Sources: [RUJI Money Market, Rujira documentation](https://docs.rujira.network/core-products/ruji-money-market)
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Page: https://redacted.gg/glossary/loan-to-value/