When the bitcoin price drops, your loan’s LTV ratio increases.
If bitcoin price drops significantly, we will ask you to deposit more bitcoin into the bitcoin collateral address of your loan, or pay down all of your outstanding loan balance. If the bitcoin price continues to drop without any action from you, Ledn may sell part of your bitcoin collateral to repay the loan balance outstanding at that time.
You will be sent an email notice when your loan LTV is above 70% to add more bitcoin collateral. Additional email reminders will follow, including if your loan LTV reaches 75%. We strongly recommend frequently checking your loan LTV, and adding more bitcoin collateral to reduce the LTV before it reaches these levels.
If your loan LTV exceeds 80% at any point in time, we will automatically sell part of your bitcoin collateral to repay the loan balance outstanding at that time and send any remaining bitcoin amount into your savings account at Ledn. This is an automated process that is irreversible.