A growing number of crypto-backed lending platforms now allow borrowers to access tens of thousands of dollars without credit scores, using Bitcoin as collateral. Rates start at 9.25% APR with loan-to-value ratios typically reaching around 50%. Ledn has facilitated over $11 billion in lifetime loans, while competitors like APX Lending, Strike, and Figure offer similar terms. The main appeal lies in tax efficiency: borrowing against Bitcoin does not trigger a taxable event, unlike selling. Bitcoin collateral is typically held in segregated cold storage by institutional custodians such as BitGo and Anchorage. Risks remain significant due to Bitcoin volatility, which can trigger margin calls or forced liquidations.
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