We are going to make some clarifications regarding loans with collateral because I see that certain doubts remain, and although many things may seem obvious, I understand that for newcomers or those who have never used the tool, there may be some questions.

Loans are a perfect tool when the market has corrections; we put our cryptocurrencies as collateral at a time when they are likely oversold, and although at that moment we may request a lower loan than we could when they are worth more, this is also an advantage. Because if we take the loan at that moment, we benefit from the rebounds, and we have a wider LTV range than if we had requested it at a higher price and then the market has a correction and our liquidation risk increases, which means we would have to be more attentive to it and monitor that we do not need to add liquidity to avoid being liquidated.

When you request a loan, you should do it in a stable coin and buy the cryptocurrency that interests you and that you have already studied its fundamentals and potential. The stable coin will have the same value at the time of repaying the loan, and you will benefit from the increase of the chosen cryptocurrency. It is not very smart to take a loan in the same cryptocurrency that you are interested in because if it goes up, the debt will also increase, and you will not have gained anything.

It is a very useful tool, but it must be used responsibly; do not exceed the percentage of what we borrow concerning the value of our collateral. We should not be afraid of it; if we make mistakes, it will help us in the future to correct errors. Losing is also part of growth, and this is a risk/reward activity; we must accept losses when we make mistakes and move forward; all of this is part of our growth as investors.