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Digital Asset Loan Explained: A Simple Guide for Beginners
A Digital Asset Loan is a financial product that enables you to borrow capital using your Bitcoin as guarantee. Picture this a traditional loan, but instead of putting up your house as pledge, you're using your digital assets to obtain funds.
Many copyright platforms will require you to deposit a defined proportion of your Bitcoin as collateral. This amount is known as the loan-to-value ratio.
If you default on your loan, the lender can auction your Bitcoin to make up for the debt.
- Several categories of Bitcoin Loans available, such as
- Secured loans
- Decentralized loans
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