How does the Abra loan product work?

The Abra loan product allows users to borrow funds using cryptocurrency as collateral. Here's how it works:

1. Collateralization: Users deposit cryptocurrency into their Abra account as collateral for the loan.
2. Loan Amount: The amount that can be borrowed is determined by the collateral's market value and the loan-to-value (LTV) ratio.
3. Repayment: Users are required to repay the loan plus interest to regain access to their collateral.

What does LTV mean?

LTV, or loan-to-value ratio, measures the ratio of a loan to the value of the collateral. In the context of crypto loans, it indicates how much can be borrowed against the deposited cryptocurrency.

How is the LTV ratio managed during the loan term?

As the value of the collateral fluctuates, the LTV ratio can change. Users might need to adjust their collateral or repay part of the loan if the LTV exceeds acceptable limits.

Are the interest rates fixed or variable during the loan term?

Interest rates for Abra loans may vary based on market conditions and the specific terms of the loan agreement. Users should check the specific interest rate terms when taking out a loan.