Bitcoin loans
Bitcoin-backed loans: borrowing against bitcoin you keep
A bitcoin-backed loan lets you borrow against bitcoin without selling it: you pledge the coins as collateral, receive US dollars or stablecoins, and get the bitcoin back when the loan is repaid. The lender sets a loan-to-value (LTV) limit and can sell some or all of the collateral if a price fall pushes the LTV past its liquidation threshold.
Key takeaways
- Half the value is the common starting point. Ledn, Milo, Unchained (as 200% collateral-to-principal) and Galaxy published starting levels equal to 50% LTV in September 2026; Xapo Bank capped loans at 40%.
- The starting ceiling is not the same everywhere. Xapo Bank states that a loan is “limited to 40% of your Bitcoin's value”, against the 50% that Ledn, SALT, Milo and Galaxy publish as a standard starting point.
- Cure windows are short. Unchained and Arch published 24 hours to answer a margin call and Figure 48 hours; at Unchained's 120% collateral-to-principal level there is no cure period.
- Custody takes three published forms. A named custodian with no rehypothecation stated, limited re-use (Ledn), and 2-of-3 multisig with a borrower key (Unchained, business loans only).
- A liquidation is a sale of your bitcoin. In many jurisdictions the loan itself is not a disposal, but a forced sale generally is a taxable event.
How lenders size a loan against bitcoin
The lender advances a percentage of the bitcoin's market value: the loan-to-value (LTV) ratio. At a 50% starting LTV you pledge US$2 of bitcoin for each US$1 borrowed, so a US$500,000 loan needs US$1,000,000 of bitcoin at the price on the day. Unchained states the same requirement the other way up, as a collateral-to-principal (CTP) ratio of 200%.
The price the lender tests against decides when thresholds trip. Unchained states that it uses the CME CF Bitcoin Real Time Index for commercial loans, updated every minute; Arch uses the CoinMarketCap price, updated every 60 seconds. Ask which feed the loan documents name and how often it updates.
Accrued interest can move the LTV too. Where interest accrues to maturity rather than being paid monthly, and the lender measures LTV on the balance including that interest, the LTV rises over the term at any given bitcoin price.
Published terms, September 2026
The table sets out what seven lenders published about their bitcoin-backed loans. It describes their own pages as accessed on 19 September 2026. It is not a ranking, and naming a lender implies no relationship with Crypto Loans HQ (see how we are paid).
| Lender | Starting LTV | Warning or margin call | Liquidation | Cure window | What is sold |
|---|---|---|---|---|---|
| Arch | Up to 60% | Margin call at 70% | Partial at 80% | 24 hours, back to 60% | Part of the collateral |
| Figure (50% initial LTV) | 50% (75% also offered) | Notice at 75%; margin call at 80% | Automatic at 90% | 48 hours, back to initial LTV | 2% processing fee on crypto sold, where allowed |
| Ledn | 50% typical | Notifications at 70% and 75% | Automatic at 80% | None stated | Enough to cover the balance, remainder returned; 0.50% trade spread |
| Milo | About 50% (pledge twice the loan) | Margin call at 67% | Set in the loan documents | None stated | Not stated |
| SALT | 30%, 50% or 70% | Warning at 75%; margin call at 83.33% | Margin event at 90.91% | None stated | Part of the collateral |
| Unchained (business loans) | 200% CTP (≈50%) | Violation below 150% CTP (≈66.7%) | Foreclosure at 120% CTP (≈83.3%) | 24 hours; none at 120% CTP | Enough to repay the balance and fees, remainder returned |
| Xapo Bank | 20%, 30% or 40% | Add collateral or repay above 65% | Sells collateral at 80% | None stated | Enough to cover what you owe |
| Listed alphabetically. Sources: each lender's own pages, accessed 19 September 2026 (listed below). ≈ figures are our arithmetic (LTV = 1 ÷ CTP). Ranges lenders published as of September 2026; terms depend on the lender, the collateral and the borrower, and are set only by the lender. | |||||
Two patterns stand out. The gap between the starting LTV and the liquidation level is the borrower's cushion: 30 percentage points at Ledn, 20 at Arch, 40 at Xapo Bank on a 40% loan. And where a cure window is published, it is a day or two, so a borrower needs spare bitcoin or cash ready to move at short notice.
Margin calls and liquidation
When the LTV crosses the margin-call level, the lender asks you to bring it back down by adding bitcoin or repaying part of the loan; every lender in the table names those two cures. Ledn also offers an optional Auto Top-Up that moves bitcoin from the client's own Ledn account when the LTV touches 70%, bringing it back to 68%.
If the LTV reaches the liquidation level, the lender sells without waiting for you. Some sell only enough to restore a target LTV; others sell enough to repay the whole balance and return what is left. Either way the sale happens after the price has fallen, and it fixes the loss on the coins sold.
Worked example
A US$500,000 loan at 50% LTV is secured on US$1,000,000 of bitcoin. A 28.6% fall takes the collateral to US$714,286 and the LTV to 70%, Arch's margin-call level and Ledn's first notification. To cure back to 50% you would post about US$285,714 more bitcoin at the new price, or repay US$142,857. A further fall to 80% LTV, 37.5% below the starting price, reaches the liquidation level at Ledn and Xapo Bank.
The guide to bitcoin loan margin calls walks through a call from trigger to sale, including how partial and full liquidations differ in the bitcoin you lose.
Custody models for bitcoin collateral
Who holds the bitcoin, and what the contract lets them do with it, decides what happens if the lender fails. Lenders publish six arrangements, and the collapse of Celsius shows a seventh.
| Model | Who can move the bitcoin | Rehypothecation, as published | What you can verify | Published example |
|---|---|---|---|---|
| Lender custody, re-use permitted | The lender | Permitted by the contract | Only what the lender reports | Celsius's retail loan terms, as quoted by the court (2023) |
| Custodian, limited re-use | The lender, through its custodian | Re-posting only to a US dollar funding partner or financing vehicle; not lent out | The re-use clause; proof-of-reserves attestations | Ledn (custodied loans) |
| Named custodian, segregated | The custodian, on the lender's instruction | Stated not to occur | The custodian's name; whether the account is segregated | Arch (Anchorage Digital), Milo (Coinbase and BitGo) |
| Unnamed custodian, segregation stated | The custodian, on the lender's instruction | Stated not to occur | The custody clause only | Figure (“our qualified custodian”), SALT (“qualified institutional custodians”) |
| Bank-held | The bank that made the loan | “No rehypothecation of Bitcoin” | The bank's own published terms | Xapo Bank, lending US dollars against bitcoin it holds |
| 2-of-3 multisig | Any two of borrower, lender and key agent | Stated not to occur | The collateral address, onchain | Unchained, in a segregated sub-trust |
| Wrapped or tokenized bitcoin | A smart contract, or the token's issuer | Governed by the protocol | The contract; the issuer or bridge behind the token | Ledn's guide flags the added issuer, bridge or smart-contract dependency |
| From each firm's own pages, accessed 19 September 2026, and the Celsius opinion of 9 November 2023. Custody statements are the firms' own descriptions, not legal conclusions; terms are set only by the lender. | ||||
A custodian's name is not the whole answer. Ask whose name the account is in, what the lender may instruct the custodian to do besides returning or selling the coins, and what it publishes about bankruptcy remoteness. Arch describes its collateral as bankruptcy-remote and structurally separated from its balance sheet; Ledn describes ring-fenced or bankruptcy-remote structures. Those are the firms' own descriptions, not legal conclusions; bitcoin loan rehypothecation and custody sets out the clauses to read.
Risk
Risks to weigh before borrowing
- Margin calls and forced liquidation. Bitcoin's price moves around the clock, and the LTV moves with it. A margin call gives you 24 to 48 hours at the lenders that publish a window, and none at some liquidation levels. If you cannot add bitcoin or cash in time, the lender sells.
- Counterparty and custody risk. If the loan terms let the lender re-use your bitcoin and the lender becomes insolvent, you may be left with a creditor's claim instead of your coins. On 9 November 2023 the Celsius bankruptcy court held that collateral posted by retail borrowers who objected to the plan was property of the estate. BlockFi and Genesis also filed for Chapter 11 in 2022 and 2023.
- Tax on a liquidation. A liquidation sells your bitcoin at a time you did not choose, and a sale is generally a taxable event. Some structures that transfer ownership of the collateral can be a disposal from the start. Take advice from a tax adviser.
- Maturity. Principal falls due at the end of the term. Ledn, for example, requires the LTV to be below 65% to renew, so a fall late in the term can force a repayment in cash or a sale.
See also bitcoin loan margin calls and are crypto loans taxable.
Bitcoin loans for companies and miners
Company borrowing uses the same mechanics at larger size, disclosed in public filings. MARA Holdings' quarterly report shows that on 4 August 2026 it entered two bitcoin-backed term loans, from Coinbase Credit (a US$450.0 million commitment) and Two Prime Lending (US$300.0 million), and pledged 18,750 bitcoin, with a fair value of about US$1.2 billion, as initial collateral. The filing says that if collateral falls below the margin-call limit, MARA must post more, and that failing to do so is an event of default entitling the lender to liquidate the pledged bitcoin.
An earlier example sets out a covenant in full. On 23 March 2022 a MicroStrategy subsidiary borrowed US$205.0 million from Silvergate Bank against bitcoin then worth about US$820.0 million. The LTV had to stay at or below 50%; above that, the borrower had to add bitcoin or prepay until the LTV was 25% or less. The loan was prepaid in March 2023 and the security released.
Unchained's business loans have a US$150,000 minimum, and it routes financing of US$5 million or more to an institutional lending desk. Galaxy describes miner financing typically secured by miner treasuries and site and infrastructure assets. The bitcoin treasury financing page covers facilities for companies, miners and funds.
Borrowing against bitcoin or selling it
Borrowing keeps your bitcoin exposure and adds a debt with a liquidation trigger; selling ends both. The tax position is general, not a strategy. The main IRS guidance, Notice 2014-21 and the IRS virtual currency FAQs, treats bitcoin as property and says nothing about loans or collateral. HMRC's Cryptoassets Manual, in guidance written for decentralized finance, says posting tokens as collateral is a disposal if the platform may deal with them as it wishes, and that a gain on a liquidation is the borrower's (CRYPTO61640).
The guide to whether to borrow against bitcoin instead of selling sets out the trade-off, and are crypto loans taxable covers the tax questions. The wider market, including ether collateral, is on crypto-backed loans, property purchases are in bitcoin mortgages, and the stages of an enquiry on how it works.
General information, not advice. This page describes bitcoin-backed loans in general terms. It is not an offer to lend or to arrange a loan on particular terms, and it is not investment, legal or tax advice. Lenders are named only to describe what they published, as dated; naming a lender is not a recommendation and implies no relationship with Crypto Loans HQ. Terms are set only by the lender. Take advice from a qualified tax adviser before borrowing against, or selling, bitcoin. How we are paid.
Primary sources
- Arch: When do I get margin called or partially liquidated? (updated 30 March 2026) and Arch
- Figure: Crypto-backed loans FAQ (accessed September 2026)
- Ledn: Bitcoin-backed loans (accessed September 2026)
- Milo: Crypto-backed loan (accessed September 2026)
- SALT: Understanding LTV and margin calls (dated 26 March 2026) and SALT: Bitcoin loans
- Unchained: Loans, margin call process, loan collateral and bitcoin price (accessed September 2026)
- Xapo Bank: Borrow (accessed September 2026)
- Galaxy: Crypto Portfolio Line of Credit on GalaxyOne (25 August 2026) and Galaxy: Lending
- MARA Holdings: Form 10-Q for the quarter ended 30 June 2026 (filed 6 August 2026)
- MicroStrategy: Form 8-K on the Silvergate term loan (March 2022) and Form 8-K on its prepayment (March 2023)
- In re Celsius Network LLC: corrected memorandum opinion (9 November 2023)
- IRS Notice 2014-21 and IRS: Frequently asked questions on virtual currency transactions
- HM Revenue and Customs: Cryptoassets Manual, CRYPTO61640
Bitcoin-backed loans: frequently asked questions
How much can I borrow against bitcoin?
Starting loan-to-value levels that lenders published in September 2026 clustered at 50%, so US$1,000,000 of bitcoin supports a loan of about US$500,000 at that level. Some lenders offered more (Arch up to 60%, SALT up to 70%, Figure up to 75%), which leaves less room before a margin call. Terms are set only by the lender.
At what LTV do lenders publish a margin call?
At different levels, and each lender sets its own. In September 2026 Xapo Bank asked for a top-up above 65%, Milo published a margin call at 67%, Arch at 70%, Figure at 80% on loans written at 50% and at 85% on loans written at 75%, and SALT at 83.33%. The arithmetic of how far the price must fall to reach one is worked through in the guide to bitcoin loan margin calls.
Can I borrow against bitcoin and keep a key to the collateral?
Yes, with a multisig lender. Unchained holds loan collateral in a 2-of-3 multisig in which the borrower holds one key, so no single party can move the coins, and states that it does not rehypothecate that bitcoin. As of September 2026 Unchained lends only to businesses, with a US$150,000 minimum.
Does pledging bitcoin as collateral count as a disposal?
It depends on what the agreement lets the lender do with it. HMRC's guidance on DeFi lending treats a platform that may deal with the collateral as it wishes as having acquired beneficial ownership, which makes posting it a disposal; a platform specifically restricted from dealing with it has not. The IRS has published nothing either way. Take advice from a tax adviser.
When do I get my bitcoin back?
When the loan is repaid, the lender returns the collateral, less any bitcoin already sold in a liquidation. Some lenders also release excess collateral during the loan after a price rise: Ledn allows redemption when the LTV is below 30%, back to a 40% target, subject to conditions and a US$100,000 cap per 60 days.
Bitcoin loan enquiries
Borrowing against bitcoin in size?
Tell us how much bitcoin you would pledge, how much you want to borrow and the custody terms you need. We check the enquiry against the criteria lenders publish and, where one fits, arrange an introduction. The lender sets the LTV, the rate and the terms.