High LTV Ratios

A standout feature of Stormbit’s model is the ability to offer higher loan-to-value (LTV) ratios than conventional lending platforms, without sacrificing safety.

On typical oracle-based platforms, LTV (loan amount ÷ collateral value) must be conservative (usually 50–75%) because the protocol needs a buffer to handle rapid price drops before an oracle triggers liquidation. Stormbit flips this logic by eliminating automatic liquidations during the term. Here’s how higher LTVs are achievable on Stormbit.

Short Loan Durations Reduce Risk

High LTV is made safer by the fact that loans are typically short-term or fixed-term. The probability of a catastrophic price drop (e.g >15% drop that would put an 85% LTV loan underwater) is lower over a 1-7 days than over an indefinite period. Term managers can set shorter durations for higher LTV offerings, controlling risk. For instance, a 90% LTV loan might only be offered for, say 3 days term on a major asset. This limits lenders' exposure - they only need to worry about the collateral holding its value for that term length.