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Quote from: Smigo on Today at 07:39:44 AM

What does it mean to use Altcoins as collateral like ETH or other Altcoins to get BTC loan? I mean I have 3 ETH, why should I not sell it to get the amount of BTC that I need instead of giving it to someone as collateral to get the same amount of BTC that I need? Is there any technical meaning for doing that or why is it like that?

What does it mean when you go to a bank a give them your house as collateral? You should sell it and get the money that you need/ want. But you don't want to actually sell it, right? Same with using alts as collateral. You don't want to lose them/ sell them but you want to get more...

Thanks for the details bro. But there is a difference between a house as collateral and a coin as collateral, I mean you may want to sell your house to get the money you need, but you may not find a client to buy it! So instead you decide to mortgage your house to get a bank loan. But we all know selling altcoins is easy and you can do it at any time in any exchange or wallet, unlike the house because you will need to find someone to buy it. And that's why I wanted to know why altcoins can be used as collateral while we can sell them easily to get the money that we want... but thank you I understand you well.

When you put your house as collateral, the bank will not give you a loan equal to the actual value of the house. if they are forced to sell it, they will sell it for the amount of your debt to them, no matter is it half of the real price.
Also, your collateral must be higher than a loan, so the lender can easily sell it if something going wrong.

Absolutely! They must do so in order to compensate for any losses that may occur, now I understand how this type of loan works.
Thank you so much for adding this.