Glossary

The Platform for Everything DeFi on Aptos

• Loan-to-Value (LTV) Ratio: This ratio indicates the proportion of the loan relative to the value of the collateral. For instance, if you borrow $50 against a collateral worth $100, the LTV ratio is 50%.

• Maximum LTV (Max LTV): This is the highest permissible LTV ratio set by the platform or lender. It represents the maximum amount you can borrow against your collateral. For example, if the Max LTV is 70%, and you have collateral worth $100, you can borrow up to $70.

The Max LTV is crucial for managing risk. If the value of the collateral falls or the value of the borrowed assets increases beyond the Max LTV, the borrower may need to provide additional collateral or risk liquidation of their assets.

• APT borrow rate is the interest rate charged on borrowing APT. When users take out a loan in APT on a DeFi platform, they are required to pay interest on the borrowed amount. This interest rate, known as the borrow rate, is typically expressed as an annual percentage rate (APR).

Understanding the APT borrow rate is essential for users who want to engage in borrowing activities, as it directly impacts the cost of their loan and the profitability of your investment strategies.