The liquidation point is reached once the collateral is not able to cover for the original principal + interests anymore.
Lets assume a LTV ratio of 67% and a loan of $5,000 at the market price of $65,000. You'd have to put up a collateral of $7,500 or 0,1154 btc.
If the price drops to $43,333, the collateral of 0,1154 would have reach an equal value of the original principal ($5,000), thus the liquidation point is reached.
This simple example ignores any fees and interest to be paid, what would change the liquidation price.
The liquidation point is reached once the collateral is not able to cover for the original principal + interests anymore.
Lets assume a LTV ratio of 67% and a loan of $5,000 at the market price of $65,000. You'd have to put up a collateral of $7,500 or 0,1154 btc.
If the price drops to $43,333, the collateral of 0,1154 would have reach an equal value of the original principal ($5,000), thus the liquidation point is reached.
This simple example ignores any fees and interest to be paid, what would change the liquidation price.