As Bitcoin evolves from a speculative digital asset to a recognized form of digital capital embraced by institutions and governments alike, its real-world financial utility continues to grow. One of the most practical applications of this evolution is Bitcoin-backed loans, which allow holders to unlock liquidity without parting with their BTC. These loans combine Bitcoin’s decentralized security with modern lending mechanics, offering a censorship-resistant alternative to traditional financing.
This guide explores the top platforms offering Bitcoin-backed loans in 2025, detailing their features, risks, and unique benefits. Whether you're a long-term holder seeking short-term capital or an institution exploring on-chain financing, this overview will help you make informed decisions.
👉 Discover how Bitcoin-backed loans can boost your financial flexibility without selling your assets.
What Are Bitcoin-Backed Loans?
Bitcoin-backed loans enable users to borrow fiat or stablecoins by using their Bitcoin as collateral. Instead of selling BTC—potentially triggering taxes or missing out on future gains—holders can access cash while maintaining ownership of their digital assets. These loans are typically over-collateralized, meaning borrowers must pledge more in BTC value than the loan amount, reducing default risk.
Key factors to consider:
- Loan-to-Value (LTV) ratio: The percentage of your collateral’s value you can borrow against.
- Interest rates: Vary by platform, loan term, and collateral amount.
- Liquidation risk: If Bitcoin’s price drops, you may need to add more collateral or face partial or full liquidation.
- Custody model: Whether the platform holds your BTC (custodial) or you retain control (non-custodial).
Top Platforms Offering Bitcoin-Backed Loans
Bitfinex Borrow
Established in 2012, Bitfinex is one of the longest-running cryptocurrency exchanges offering Bitcoin-backed lending. Through Bitfinex Borrow, users can secure loans with up to 80% LTV, one of the highest ratios available. Supported currencies include USD, USDT, and EUR.
Interest rates are competitive and fluctuate based on market demand and loan duration. Users retain custody of their collateral via multi-signature wallets, enhancing security. However, the high LTV increases liquidation risk during volatility.
Bitfinex Borrow is accessible globally (excluding restricted regions), making it a solid choice for experienced traders seeking high leverage.
Debifi
Debifi, developed by Hodl Hodl and launching in 2025, is a peer-to-peer lending platform focused on long-term Bitcoin-backed loans. It enables borrowing in fiat or stablecoins using non-custodial multi-signature smart contracts, ensuring borrowers retain full control of their BTC.
The platform operates without KYC, prioritizing privacy and decentralization. Lenders and borrowers negotiate terms directly, including interest rates and repayment schedules. This flexibility appeals to users who value autonomy and censorship resistance.
While still upcoming, Debifi shows strong potential for those seeking trustless, global lending solutions.
👉 See how decentralized lending platforms are reshaping access to capital.
Firefish
Based in Prague, Firefish is a Bitcoin-native financial platform serving European clients since 2022. It offers Bitcoin-backed loans with an LTV cap of 50%, conservative compared to others, reducing liquidation risk.
Loans range from 3 to 18 months and are disbursed in EUR or CZK directly to bank accounts. Firefish emphasizes security—collateral is stored in multi-signature wallets, and rehypothecation is strictly prohibited.
With a transparent, no-KYC model, Firefish is ideal for privacy-conscious European borrowers who want reliable access to fiat without selling BTC.
FUJI Finance
FUJI Finance operates on the Liquid Network, a Bitcoin sidechain, enabling users to borrow synthetic assets like fUSD (Fuji USD) against L-BTC collateral. For every $1.50 worth of BTC locked, users receive $1 in fUSD—ensuring over-collateralization.
The system is non-custodial and governed by smart contracts. Repayment involves burning the borrowed fUSD plus a 0.25% redemption fee to unlock collateral. Since it runs on a secure Bitcoin-pegged chain, FUJI offers strong asset protection.
This platform suits advanced users comfortable with sidechains and synthetic assets.
HODL HODL
HODL HODL is a peer-to-peer marketplace offering non-custodial Bitcoin-backed loans. Borrowers and lenders set their own terms anonymously, including interest rates, duration, and currencies (fiat or stablecoins).
A multisig escrow holds the BTC until repayment, at which point the lender releases the collateral. No KYC is required, preserving user privacy.
While liquidity may vary compared to centralized platforms, HODL HODL offers unmatched control and decentralization for trustless lending.
Lava
Launched in 2022, Lava is a U.S.-focused decentralized platform providing non-custodial Bitcoin-backed loans with up to 60% LTV and interest rates starting at 4% APR.
Built on smart contracts, Lava ensures borrowers retain full oversight of their collateral. The platform integrates with wallets and trading tools, offering a seamless DeFi experience. With no KYC and transparent operations, Lava appeals to privacy-first users.
Monitoring LTV ratios is crucial due to market volatility.
Ledn
Canadian-based Ledn offers Bitcoin-backed loans with an initial 50% LTV, rising to 70% for warnings and 80% for full liquidation. One standout feature: no monthly payments—interest accrues and is paid only upon loan closure.
Ledn uses BitGo for cold storage and provides Proof-of-Reserve audits for transparency. It also pioneers Bitcoin mortgages in Ontario, combining property and BTC as over-collateralized security.
While custodial, Ledn balances institutional trust with crypto-native features.
Sovryn Zero
Sovryn Zero runs on RSK, a Bitcoin sidechain, allowing users to borrow ZUSD—a USD-pegged stablecoin—at zero interest. Collateral must be converted to RBTC (1:1 BTC peg) and locked on-chain.
The minimum collateral ratio is 110%, meaning you must maintain at least $1.10 in BTC for every $1 borrowed. The system is non-custodial, KYC-free, and governed by stakers.
Ideal for long-term holders seeking interest-free leverage with full control.
Unchained Capital
U.S.-based Unchained Capital specializes in Bitcoin-only lending with no credit checks or rehypothecation. Loans are approved within 24 hours, with APRs starting at 12.58% and an origination fee of 0.75%.
Collateral remains secure under collaborative custody, meaning both parties control access keys. This hybrid model enhances security while maintaining usability.
Best suited for American long-term HODLers needing fast liquidity.
Verifi21
Set to launch in Q1 2025 for European users, Verifi21 promises a simple 5-minute loan application with KYC verification. Loans will be issued in EUR or USD stablecoins with undisclosed interest rates but expected one-year terms.
The platform accepts only BTC as collateral, stores it with institutional custodians, and conducts bi-annual Proof-of-Reserve audits. Liquidation occurs if LTV thresholds are breached.
A promising option for regulated yet secure European lending.
ZEST Protocol
ZEST is an institutional-grade on-chain capital market where corporations borrow against their Bitcoin holdings. Liquidity providers earn 4–6% yield by joining managed pools.
Currently exclusive to approved institutional borrowers with strict KYC, ZEST represents the future of enterprise Bitcoin financing—secure, transparent, and integrated into corporate balance sheets.
Core Keywords
Bitcoin-backed loans, BTC lending platforms, crypto loans without selling, non-custodial lending, loan-to-value ratio, decentralized finance (DeFi), over-collateralized loans, Bitcoin liquidity solutions
Frequently Asked Questions
Q: Do I need to sell my Bitcoin to get a loan?
A: No—Bitcoin-backed loans let you borrow against your BTC without selling it. You retain ownership as long as you meet repayment terms.
Q: What happens if Bitcoin’s price drops during my loan?
A: A price drop increases your LTV ratio. If it hits the liquidation threshold (e.g., 70–80%), the platform may sell part or all of your collateral unless you add more funds.
Q: Are Bitcoin-backed loans safe?
A: Safety depends on the platform. Non-custodial and audited platforms (like Ledn or Firefish) reduce counterparty risk. Always monitor your LTV and choose reputable providers.
Q: Can I get a Bitcoin loan without KYC?
A: Yes—platforms like HODL HODL, Sovryn Zero, and Lava offer KYC-free lending using smart contracts or P2P models.
Q: What’s the benefit of using a sidechain like RSK or Liquid?
A: Sidechains offer faster transactions and smart contract functionality while inheriting Bitcoin’s security through merge-mining or pegging mechanisms.
👉 Compare top Bitcoin lending platforms and find the best fit for your financial goals today.