Borrow Against Your Bitcoin or Other Crypto: A Complete Guide

What a Crypto-Backed Loan Is

A crypto-backed loan uses an eligible asset as collateral under a specific lender, platform, contract, custody, payment, and jurisdictional arrangement. A borrower may retain economic exposure to the collateral, but can lose some or all of it through liquidation, default, fraud, contract failure, key loss, fees, disputes, or failed recovery.

Borrowing is not automatically cheaper, safer, tax-free, or more flexible than selling. Obtain qualified financial, tax, and legal advice for the actual arrangement.

Terms to Verify

Before relying on an offer, verify:

• the lender, borrower, collateral asset, loan currency, network, wallet, and payment route
• identity, AML, sanctions, source-of-funds, credit, regional, and account requirements
• who controls collateral and whether any claimed escrow is deployed, funded, and independently verifiable
• principal, interest calculation, fees, LTV, valuation source, margin-call and liquidation thresholds
• term, repayment schedule, early-repayment rights, default events, grace periods, and extensions
• release, refund, dispute, signature, timeout, recovery, insolvency, and governing-law terms

Names such as “escrow,” “non-custodial,” or “2-of-3” do not prove that collateral is protected or recoverable.

Loan-to-Value and Liquidation

LTV compares the loan balance with the collateral value under the agreement’s valuation method. Values, thresholds, notices, and remedies are offer-specific. Prices can move faster than alerts or transactions, and adding collateral or repaying early may be unavailable or fail during volatile or congested markets.

An illustrative calculation is not a quote: if collateral is valued at $100,000 and an agreement permits a $60,000 loan, the starting LTV is 60%. It does not establish a safe LTV, liquidation threshold, interest rate, or expected market move.

Custody and Settlement

On CoinExchange.Cash Lending, use only a route that is currently enabled for the selected asset, network, account, and jurisdiction. Inspect the live offer and on-chain state. Do not assume:

• collateral enters funded 2-of-3 escrow
• a lender will fund after collateral is sent
• one party cannot move funds alone
• an arbitrator is available or independent
• repayment automatically returns collateral
• a default automatically transfers collateral
• a split, refund, release, or recovery transaction will succeed

Current real-chain funded lending, collateral-release, and dispute settlement must not be inferred from a listed asset or user-interface option.

Tax and Legal Treatment

Selling, borrowing, pledging, transferring, liquidating, receiving interest, paying fees, or using collateral can have different tax, licensing, reporting, consumer-credit, sanctions, and accounting consequences. Treatment varies by jurisdiction, residency, entity, purpose, asset, and contract structure and can change over time.

Keep the records required by applicable law and consult qualified advisers. CoinExchange.Cash does not guarantee that a loan avoids a disposal, tax, reporting duty, or regulated-credit requirement.

Risk Checklist

• Can you afford complete loss of the collateral and the loan-related fees?
• Is the price source reliable and is liquidation mechanically verifiable?
• Are the contract, keys, signers, funding, and recovery path independently verifiable?
• Can the payment be reversed or disputed?
• What happens if a party, provider, network, oracle, wallet, or frontend becomes unavailable?
• Are the terms lawful and enforceable for every participant and jurisdiction involved?

Using CoinExchange.Cash Lending

1. Open CoinExchange.Cash Lending and check whether a relevant product and route are enabled.
2. Review the exact offer, eligibility, collateral, network, payment, fee, custody, and dispute terms.
3. Verify any claimed funded escrow or contract before transferring assets.
4. Preserve transaction, payment, communication, and agreement evidence.
5. Follow only the displayed repayment, release, refund, liquidation, or dispute process.

Availability, interest, funding, repayment, collateral release, and recovery are not guaranteed.

• Review Lending Offers →
• Learn What to Verify in Escrow →