You want cash, you do not want to sell your Bitcoin, and you want to know whether this is safe. That is the real question behind borrowing against Bitcoin, and the honest answer is that it can be a well-understood, manageable way to raise money, or a fast way to lose coins, depending on a few choices you make before you sign.
To borrow against Bitcoin, you pledge it to a lender as collateral, receive cash, and repay the loan later to get your Bitcoin back. You never sell, so you keep your stack and its future upside and, under current US rules, generally avoid a taxable sale (the IRS sets out its treatment of digital assets). The catch is that a loan adds real risks a buy-and-hold position does not have, from a forced sale of your collateral to the lender itself, and this guide is straight about all of them. It walks through exactly how to do it: the steps, how much you can borrow, what it costs, the full risk set and how to manage it, CeFi versus DeFi, how to choose a lender, and a checklist to run before you borrow. We are a comparison publisher, not a lender, so nothing here is a pick of one provider over another.
How to borrow against Bitcoin, step by step
Apply
Lender sets your amount, rate, term, and max LTV.
Pledge BTC
Your bitcoin moves into custody as collateral.
Receive cash
Funds paid out in dollars or a stablecoin.
Pay interest
Monthly, or accrued to the end of the term.
Reclaim BTC
Repay in full and your bitcoin is released.
- Decide how much you need, and at what LTV. The loan-to-value ratio is your loan divided by your collateral value. A lower LTV leaves more room before trouble. Model your numbers first with the loan calculator.
- Choose a lender by custody and effective APR, not the headline rate. Where your Bitcoin sits, and whether it can be re-lent, matters more than a fractional rate difference. Use the comparison tool and the reviews.
- Apply and pledge your Bitcoin. Depending on the lender, your collateral goes into the lender's custody, a qualified custodian, a collaborative-custody setup where you hold a key, or a smart contract. Most lenders run no credit check; the Bitcoin underwrites the loan.
- Receive your cash. Usually dollars to your bank or a stablecoin, in anywhere from minutes (DeFi) to a few business days (institutional lenders).
- Repay and reclaim your Bitcoin. Pay interest over the term, repay the principal, and your collateral is released back to you.
How much can you borrow against Bitcoin?
Most Bitcoin lenders cap origination LTV between 40% and 60% of your collateral's value. At a 50% cap, $100,000 of Bitcoin gets you up to $50,000 in cash. A few lenders allow higher starting LTVs at the cost of a tighter margin-call buffer; see highest-LTV bitcoin loans.
Borrowing well below the cap is the cushion that protects you. The lower your starting LTV, the further Bitcoin has to fall before a margin call. Many cautious borrowers stay near or below 25% to 30%.
What it costs to borrow against Bitcoin
The number that lets you compare lenders fairly is the effective APR including the origination fee, not the advertised rate. The table below renders live from the same database that powers our comparison tool; for where rates sit across lenders right now, see our weekly Bitcoin Loan Rate Index.
Lender facts on this page render live from our comparison database, last verified July 10, 2026. Figures refresh weekly; for the current set and your own loan size, see the comparison tool.
| Lender | Effective APR (incl. origination) | Max LTV |
|---|---|---|
| APX Lending | 9.99% to 11.49% | 60.00% |
| Arch (Deferred) | 9.49% to 10.99% | 60.00% |
| Arch (Standard) | 8.99% to 10.49% | 60.00% |
| CoinRabbit | 11.95% to 16.80% | 90.00% |
| Figure | 9.76% to 12.35% | 75.00% |
| Ledn | 9.99% to 11.49% | 50.00% |
| Nexo | 18.90% | 50.00% |
| SALT | 7.49% to 10.50% | 70.00% |
| Strike | 7.75% to 10.47% | 50.00% |
| Unchained | 14.18% | 50.00% |
These are starting points, not a ranking. Weigh custody, term, and how much cushion you keep, not just the cheapest headline number.
The risks, and which one matters most
A Bitcoin loan carries four risks worth naming up front. The first is the one to design around; the others are real and mostly avoided by choosing the right lender and the right terms.
- Liquidation when Bitcoin falls. The biggest and most likely risk. Your loan amount is fixed, so when Bitcoin falls your collateral is worth less and your LTV rises. Cross the lender's threshold and you get a margin call to add collateral or pay down the loan; ignore it and the lender liquidates part of your Bitcoin.
- Counterparty and custody. The risk that the lender, not the market, is what hurts you. If your collateral sits in an opaque pool, your Bitcoin can be caught up in a lender failure even if the price never moves against you.
- Rehypothecation. A specific custody failure: when a lender reuses, or re-lends, the collateral you pledged while your loan is open. It is the practice that sank several lenders in 2022.
- Cost. A loan can be safe and still be a bad deal. The effective APR including the origination fee, plus the liquidation fee that only shows up if things go wrong, is the real price.
A forced liquidation is the outcome to design around: it sells your Bitcoin at the worst time and is itself a taxable event. The main defense is a low starting LTV, so the trigger price sits far below today's. Model the exact trigger price with the loan calculator and the liquidation price calculator.
For the full risk-by-risk treatment, including the cure window and how a rough week actually plays out, read our deep-dive on whether bitcoin loans are safe. And because custody is the risk that caused the catastrophic losses last cycle, the companion guide to custody and rehypothecation shows where each lender holds your Bitcoin and whether it can be reused. If you read two things before borrowing, read those two.
CeFi vs DeFi: which should you use?
There are two fundamentally different ways to borrow against Bitcoin, and the single question underneath both is who holds your Bitcoin while you owe against it.
- CeFi (centralized finance) means borrowing from a company, such as Ledn, SALT, Arch, or Unchained. It runs KYC, takes or arranges custody of your collateral, and lends you US dollars. Rates are usually fixed or lender-set, and most CeFi lenders give you a cure window and a human to call before any liquidation.
- DeFi (decentralized finance) means borrowing from a smart contract, such as Aave or Morpho. There is usually no KYC, funding is near-instant, your collateral sits in code you can verify on-chain, and you typically receive a stablecoin rather than dollars. The rate is variable with no ceiling, and liquidation is automatic and immediate, with no grace period.
Roughly: choose CeFi when you want dollars, a predictable rate, and a cure window before liquidation. Choose DeFi when you want the lowest available rate, speed, no KYC, and verifiable collateral, and you are comfortable managing a variable rate and automatic liquidation yourself. Neither is simply safer; the risks just sit in different places. For the full side-by-side on custody, rates, liquidation, KYC, and tax, see CeFi vs DeFi bitcoin loans.
How to choose a lender
This is a decision framework, not a ranking. We compare lenders; we do not pick a best one. These are the factors that matter when you compare Bitcoin-backed loan lenders, weighed in order: the early ones decide whether you can lose Bitcoin for reasons outside your control, and the later ones decide cost and convenience.
- Custody and rehypothecation first. Where your Bitcoin sits and whether it can be re-lent. This is what separated the lenders that survived 2022 from the ones that did not, and it is the risk you cannot fix after the fact. Prefer a qualified custodian or collaborative custody, and a clear no-rehypothecation policy.
- Track record and how established the lender is. How many years it has run this specific lending product, and its scale, how much it has lent, where the lender discloses it. A lender that has carried a Bitcoin loan book through a full market cycle, including the 2022 stress, is more battle-tested than a new entrant and less likely to be the counterparty that fails you. We weight years of operation in our default ranking; for scale and volume, check what each lender publishes.
- Effective APR, including the origination fee. The true annual cost, not the headline rate. Compare the all-in number across lenders.
- Maximum LTV, liquidation threshold, and cure window. How much you can borrow, how far Bitcoin can fall before a margin call, and how long you have to react before anything is sold.
- Term, payments, and prepayment terms. Monthly payments versus accrued interest, and whether you can repay early without penalty.
- Funding speed and state availability.
For the full treatment of how these loans work, read our complete guide to bitcoin loans. To borrow for a specific purpose, see buying a home or a car without selling.
The state of bitcoin lending in 2026
Borrowing against Bitcoin looks different than it did a few years ago. There are more lenders competing, which has compressed rates and narrowed the spread between the cheapest and most expensive options. Custody transparency has improved too: after the 2022 collapses, the lenders still standing tend to publish their custody model and no-rehypothecation stance, because it is now a selling point rather than a footnote. And the line between CeFi and DeFi has blurred, with familiar brands now offering loans that are DeFi under the hood.
None of that removes the core risks, and rates still move week to week, so we do not pin live figures here. For where rates actually stand across lenders right now, including the lowest and median APR we track, see the live Bitcoin Loan Rate Index.
Your action checklist before you borrow
Run this before you sign. Borrowers who work through it rarely get hurt.
- Model your liquidation price with the liquidation price calculator so you know your trigger before you borrow, not after.
- Check the rehypothecation policy. Confirm in writing whether the lender reuses your collateral; treat a vague answer as a yes.
- Start at a conservative LTV. A low starting LTV is the single biggest lever, so a normal correction never reaches your margin call.
- Confirm the cure window. Know how long you have to add collateral or repay before anything is sold.
- Compare the effective APR including the origination fee across lenders on the comparison tool and the Bitcoin Loan Rate Index, not the headline rate.
- Keep reserve Bitcoin or cash you can post quickly, so a margin call becomes a non-event.
- Borrow only what you can comfortably service and repay. The cure window only helps if you have something to deploy.
- Read the margin terms before the rate. The liquidation threshold and liquidation fee decide how a bad week ends.
This is not financial advice
borrow/on/bitcoin is a comparison publisher, not a lender, broker, or financial or tax advisor. Bitcoin loans carry real risk, including the forced sale of your collateral, and tax treatment depends on your situation and on rules that can change. Compare current terms on our tool and confirm anything here with a qualified professional before acting on it.