LTV is the leverage on your loan
A low LTV survives a crash; a high one liquidates on an ordinary dip. Keep a wide buffer below the liquidation LTV. Watch the same risk from the loan side on the health factor calculator.
LTV is your distance to trouble
Loan-to-value is borrowed amount divided by collateral value. Borrow $5,000 against $10,000 of ETH and you're at 50% LTV. The protocol's liquidation LTV β say 80% β is the line: your collateral only needs to fall 37.5% for a 50% starting LTV to hit it.
That conversion (start LTV β price drop that liquidates you) is the number that matters, and people consistently get it wrong because it's not linear. From 50% LTV you survive a 37.5% drop; from 65% only a 19% drop; from 70%, 12.5%. The last few percent of borrowing capacity cost most of your safety.
Crypto-specific wrinkle: both sides can move. Borrow a volatile asset against volatile collateral and LTV swings from both directions at once. The conservative pattern β volatile collateral, stablecoin debt, LTV under 40% β survives everything short of a collapse. Everything tighter is a timing bet.