Question 1

What's the difference between a margin call and liquidation on a crypto-backed loan?

Accepted Answer

A margin call is a warning, not an action — your loan-to-value ratio has climbed high enough that the platform flags the account and asks you to either add more collateral or pay down part of the loan. Nothing gets sold at this stage, and most platforms give you a window (sometimes hours, sometimes a day or two depending on how fast the price is moving) to respond. Liquidation is the platform actually selling your collateral, automatically, once the LTV crosses a second and higher threshold. Some platforms do this as a partial sale that only sells enough to bring the LTV back down, others close the whole position. The gap between the margin-call LTV and the liquidation LTV is your real reaction window: a platform that margin-calls you at 71% and liquidates at 83% gives you more room to react than one that jumps from a 70% call straight to an 80% liquidation, even if the liquidation number itself looks similar.

Question 2

Why do Nexo, Ledn and YouHodler have such different LTV limits and interest rates?

Accepted Answer

Each platform is pricing a different risk appetite, not just competing on a single number. Nexo and Ledn both cap standard BTC-backed loans around 50% initial LTV, which leaves a wide buffer before their margin-call and liquidation thresholds even at roughly 50-80 points higher — that buffer is the product they're selling, and it's why their posted rates can look more competitive per dollar of real safety. YouHodler and similar high-LTV lenders let you borrow a much larger share of your collateral's value up front, which is attractive if you want more cash out of the same Bitcoin, but it compresses the room between where you start and where a margin call or liquidation hits, and platforms typically price that extra risk into a higher interest rate. Neither approach is objectively better — a low-LTV, low-rate loan and a high-LTV, higher-rate loan can both make sense depending on whether you value maximum borrowing power or maximum distance from liquidation more.

Question 3

Is a higher liquidation LTV always safer for me as a borrower?

Accepted Answer

For a fixed loan amount, yes in the narrow mathematical sense — a higher liquidation LTV means the collateral's price has to fall further before the platform sells it, because liquidation is triggered by the ratio of loan to current collateral value, not by price alone. A platform with an 85% liquidation LTV will tolerate a bigger price drop on the same loan than one with an 80% liquidation LTV. But that number usually comes bundled with a higher starting LTV too, so you're often borrowing more against the same collateral to begin with, which eats back some or all of that extra cushion. This calculator computes the actual price-drop percentage for your specific loan amount and collateral, which is the only way to know whether a platform's higher liquidation LTV translates into more real safety margin for you or not.

Question 4

What happens if I add collateral or repay part of the loan before a margin call hits?

Accepted Answer

Either move lowers your LTV and pushes both the margin-call price and the liquidation price further away from the current market price, buying you room. Adding collateral increases the denominator in the LTV ratio without touching what you owe, while repaying principal shrinks the numerator directly — both have the same effect of resetting how far the price needs to fall before you're flagged again. Most centralized lenders let you do either at any time from your account dashboard, not just during an active margin call, so borrowers who want to run a tighter LTV for a lower effective borrowing cost can top up periodically rather than parking a large collateral buffer up front. This calculator doesn't model a top-up sequence over time, but you can approximate one by lowering the loan amount or raising the collateral amount and re-reading the margin-call and liquidation prices.

Centralized Crypto Lender Comparator

Platform comparison

How it works

Reading the comparison