Compare bitcoin loans and lending services

Cryptocurrency loans offer competitive rates and reduced credit requirements, but they’re not without risk for lenders or borrowers.


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The recent rise of bitcoin and other cryptocurrencies has brought with it a new type of financial product – cryptocurrency loans that allow people around the world to borrow and lend digital currency.

Cryptocurrency loans, which are commonly referred to as bitcoin loans, provide borrowers with an alternative source of financing and allow lenders to generate additional income from their crypto holdings. Let’s take a closer look at the pros and cons of crypto loans for both lenders and borrowers.

Disclaimer: This information should not be interpreted as an endorsement of cryptocurrency or any specific provider, service or offering. It is not a recommendation to trade.

Compare bitcoin and cryptocurrency loans

Who offers cryptocurrency loans? You can find the key details of some bitcoin lending sites in the table below.

Important: Loans may not be available in all countries.
Name Product Loans App
50% LTV ratio
Borrow US$250 minimum
8-12% p.a. interest rates
Buy 55+ cryptocurrencies at true cost, earn up to 8% p.a. on holdings, pay with your crypto for cashback at stores, get loans and more with this complete crypto-finance platform.
50% LTV ratio
Borrow US$100 minimum
~10% p.a. interest rates
Trade an extensive range of reputable coins on this world-renowned exchange, popular for its high liquidity and multi-language support.

US residents: As of September 2019, US-based users can only trade USD on the American dollar onramp of Binance, Binance.US.
UK residents: In addition to normal crypto trading services, Binance offers margin lending. As this is a regulated activity which they are not authorised to offer in the UK, we advise you not to use this service. If you're interested in margin trading, see authorised providers.

Compare up to 4 providers

Name Product Passive income App
Earn returns on cryptocurrency deposits
Returns up to 12% p.a. or more depending on the cryptocurrency
Buy 55+ cryptocurrencies at true cost, earn up to 8% p.a. on holdings, pay with your crypto for cashback at stores, get loans and more with this complete crypto-finance platform.
Earn returns on cryptocurrency deposits
Join EOS, XTZ, KAVA and other staking pools
Returns up to 8% p.a. or more depending on the cryptocurrency
Trade an extensive range of reputable coins on this world-renowned exchange, popular for its high liquidity and multi-language support.

US residents: As of September 2019, US-based users can only trade USD on the American dollar onramp of Binance, Binance.US.
UK residents: In addition to normal crypto trading services, Binance offers margin lending. As this is a regulated activity which they are not authorised to offer in the UK, we advise you not to use this service. If you're interested in margin trading, see authorised providers.
Earn interest from P2P margin funding
Rates determined by market conditions
Cryptocurrencies are a highly volatile investment product. Your capital is at risk.
Spot trade all of the major cryptos on this full-featured exchange and margin trading platform.

Compare up to 4 providers

What is bitcoin lending?

The term “bitcoin lending” refers to loans denominated in digital currency, such as bitcoin or Ether, rather than in fiat currency, such as Singapore dollars or US dollars. Cryptocurrency loans work in much the same way as ordinary loans – the lender loans a specified amount of digital currency to a borrower, who then repays that amount plus interest and fees over a set period.

You can pay it back in fixed instalments or all at once, depending on your lender or your preferences. You can also get bitcoin lines of credit and short-term bitcoin loans.

Most cryptocurrency lending is carried out on a peer-to-peer basis and offers advantages to parties on both sides of the transaction:

  • For borrowers. If you’re struggling to get a traditional loan because of a bad credit history, you might be able to borrow the funds you need through a bitcoin loan.
  • For lenders. If you’re looking to generate extra income from your crypto holdings, you could lend cryptocurrency to a borrower and charge interest on their loan repayments.

How do cryptocurrency loans work?

One of bitcoin’s key features is that it allows BTC holders to transact directly with other users, without the need to go through a central bank or authority. This means that loans can theoretically be organised between any two parties with bitcoin (or any other cryptocurrency) wallets.

Online bitcoin lending platforms help facilitate these loans, connecting lenders and borrowers with one another and helping them broker a suitable loan agreement, usually for a fee. There are several brokers that offer peer-to-peer platforms, where crypto is loaned out by private owners directly to borrowers, and other services that connect borrowers with institutional lenders and wholesale investors.

The exact process for organising a loan varies between platforms. For example, borrowers may be able to specify the maximum interest rate they’re willing to pay, or the lending platform may determine the interest rate borrowers receive based on its assessment of their repayment capacity.

On the other hand, lenders may be able to browse loan requests from borrowers and choose one that suits their needs, or they can list their loan terms (amount, interest rate and repayment period) to attract applications from prospective borrowers.

Types of cryptocurrency loans

Generally speaking, the term “cryptocurrency loan” can be used to refer to two types of loans:

  • Loans that allow you to borrow cryptocurrency. These loans require you to satisfy specific criteria in order to borrow bitcoin or some other digital currency. For example, you may need to provide details of your income and employment as well as proof of ID to access a loan.
  • Loans that are obtained using cryptocurrency as collateral and that allow you to borrow fiat or crypto. In order to access this type of financing, you’ll need to offer a certain amount of crypto coins or tokens as security. The lender or lending platform will specify the currencies they will accept as collateral. Depending on the service you use, you may be able to access a loan in either fiat or digital currency.

Be cautious of arranging a loan through a bitcoin forum

You can get a loan in bitcoin without going through a platform by simply visiting online forums and dealing with individual dealers directly. You might not have to pay a platform fee (though not all platforms charge borrowers), but it’s a lot riskier for both the borrower and the lender.

It’s even harder to verify someone’s identity on a forum. And if something goes wrong, you might not have legal recourse to get your money back.

Crypto lending vs traditional lending

How do crypto loans compare to loans from traditional lenders? There are a few similarities between the two, but also some key differences.

The basics of the loan are the same – you borrow money and then pay it back with interest. You can typically repay the loan in monthly instalments or in one lump sum, and many platforms allow early repayment.

That’s where most of the similarities end. Since bitcoin isn’t affiliated with any central government or banking institution, your typical bitcoin loan will be from other bitcoin users. You’ll also need to factor any commission on the current exchange rate into your fees.

To borrow through a bitcoin loan platform, you first need to set up an account and wait for verification. However, crypto lenders don’t rely on the typical methods of judging your creditworthiness, such as your credit report, credit score or debt-to-income ratio.

Instead, most platforms give you a trust score, which they sometimes call a credit score or rating, based on how much they’re able to verify your identity and financial history. To get a high trust score, you might need to submit extensive documentation or be able to demonstrate a history of making timely loan repayments via the platform.

How can I become a lender or a borrower?

If you want to borrow funds through a cryptocurrency loan or lend coins or tokens to another user, you’ll need to register with a crypto loan platform.


Peer-to-peer lending platforms allow any individual or institution to become a lender. To get started, you’ll need to sign up for an account by providing your email address. Many (but not all) platforms will require you to provide your personal details and proof of ID before you can deposit funds and find a borrower.

However, other bitcoin lending platforms have specific criteria that you must satisfy to be able to offer loans. For example, some platforms only offer loans from their panel of registered lenders, while others will only accept customers who qualify as an accredited investor with the US Securities and Exchange Commission (SEC).


Borrowers will need to complete a few steps when applying for a bitcoin loan:

  1. Sign up. You’ll first need to sign up for an account by providing your name and email address and creating a password.
  2. Provide personal details. Next, you’ll need to provide information such as your date of birth, country of residence, address and full contact details.
  3. Provide financial details. This step is where lending platforms vary in their approach as the information you’ll be required to provide differs between lending services. It may include the following:
  • Employment details, including the industry you work in, your employer, your occupation and how long you have been in the role
  • Proof of income, so the lender can determine your repayment capacity
  • Bank accounts and PayPal accounts, so the platform can get a better idea of your financial situation
  • Marketplace transactions and feedback (eBay, Amazon, Etsy etc) to verify your ability to make on-time payments for online transactions
  • Social media accounts (Facebook, Twitter, Instagram etc), so the platform can check that you’re a real person

The lending platform will usually use the information you provide to create a rating designed to reflect your creditworthiness. This information may also be used to determine the interest rate that applies to your loan.
4. Apply for a loan. The final step is to request a loan. You’ll need to specify the currency you want to borrow, the loan term, requested amount and the loan purpose.

Bitcoin loan requirements

Getting a crypto loan might be less involved than going to a bank, but you still face basic eligibility requirements.

To join a bitcoin platform and find lenders willing to let you borrow at a competitive rate, you generally must meet the following criteria:

  • Live in a country where cryptocurrency is regulated, such as Singapore
  • Hold a steady job
  • Have a high trust score on the platform

Risks and benefits of bitcoin loans

Before deciding whether a cryptocurrency loan is right for you, make sure you’re aware of the pros and cons of bitcoin lending.

Benefits of bitcoin loans

For borrowers

  • No credit checks. If you have bad credit, accessing a loan through your bank or any other traditional lender can be difficult. However, many crypto lending platforms assess your creditworthiness using factors other than your credit score and allow you to borrow from lenders all over the world.
  • Quick sign-up process. It’s generally quick and easy to create an account with a bitcoin lending platform and start searching for a suitable lender.
  • Fast access to funds. While approval times vary between platforms, you’ll typically be able to access your loan amount quicker than if you apply for financing through a traditional lender.
  • Find loan terms that suit you. Crypto loan platforms give you the freedom to search for and negotiate competitive loan terms, such as a lower interest rate and reduced fees.

For lenders

  • Generate extra income. Lending cryptocurrency to borrowers allows you to boost your crypto balance and earn extra income. Instead of just HODLing your bitcoin and hoping the market improves, you can put your coins to work.
  • Potential to diversify. Many lending platforms allow you to spread your crypto holdings by contributing small amounts to several separate loans, rather than taking on the increased risk of lending a large amount of funds to a single borrower.

Risks of bitcoin loans

For borrowers

  • Lack of regulation. Cryptocurrency regulation is still in its infancy and bitcoin is not regulated by anywhere near as many countries as government-backed currencies. When you borrow funds through a crypto loan, you may be borrowing from people in several countries, making it difficult to hold your lender accountable if something goes wrong.
  • Cryptocurrency volatility. Cryptocurrency market fluctuations could have big implications for your loan. For example, if you’ve used your crypto coins as collateral for a loan but their value has since nosedived, you may need to provide additional collateral or make extra loan repayments to ensure that the loan-to-value ratio (LVR) remains at a level acceptable to the lender. Or, if you take out a bitcoin loan and convert it to another currency, you could end up owing several times the amount you borrowed due to varying exchange rates.

For lenders

  • Scams. Using even the best-known bitcoin lending sites comes with a level of risk. It’s extremely difficult (some might even say impossible) to thoroughly vet borrowers through lending platforms, so you’ll need to be very wary about who you lend money to. And if you sign up to a lending platform which makes promises that sound too good to be true, there’s a pretty good chance it’s a scam.
  • Borrower default. The regulation of peer-to-peer crypto lending platforms is still something of a grey area, so there may be limited recourse available if the borrower defaults on their loan. Check what procedures the bitcoin lending platform has in place for dealing with such scenarios before lending any funds.
  • Watch out for fees. Make sure you check how much commission the lending platform takes for brokering a loan, and whether they take their cut before or after the loan has been repaid. If they only charge a fee after the loan has been paid off, this may indicate that they only allow higher-quality borrowers. Fees usually range from 1% to 10% of your returns, but can be higher.
  • Price rises. If you’ve loaned out a sum of BTC for the long-term, there’s always the risk you might miss out on a bitcoin price spike.

Overcoming volatility

Bitcoin lending platforms can overcome cryptocurrency price volatility through a process known as currency pegging. This involves using fiat currency (such as SGD) as the basis for a loan.

For example, if you borrow SGD$1,000 worth of BTC, you would need to pay back SGD$1,000 worth of BTC plus interest. So if the price of BTC skyrockets and becomes worth substantially more in Singapore dollar terms, you won’t have to pay back the same amount of BTC that you borrowed.

Don’t want a bitcoin loan? Here are 3 alternative financing options

Cryptocurrency regulation is still being developed and fine-tuned around the world, and the much-publicised volatility of bitcoins means it’s much less stable than ordinary fiat currency.

If you’d rather take on a more traditional loan using fiat currency but that still offers similar features and requirements to a crypto loan, you might want to try the following:

  • Peer-to-peer loans. Peer-to-peer loans have some of the benefits of bitcoin loans, such as a similar structure and relatively low interest rates, without the risks that come with dealing in a hard-to-regulate cryptocurrency.
  • Personal loan brokers. Finding a personal loan that you qualify for and meets your needs can take some time. A personal loan broker can help match you with a suitable lender you’ll likely qualify for.
  • Bad credit personal loans. Many bad credit lenders look beyond your credit score to other parts of your financial history when underwriting your loan, just like bitcoin lenders.

Bottom line

Bitcoin loans are still a relatively new financial product and not well regulated, so thoroughly research your options before deciding whether they’re right for you.

If you don’t meet the standard credit requirements of traditional lenders, they could be a viable funding option. Crypto loan interest rates are often lower and funding can be nearly instantaneous.

Similarly, becoming a lender could be a viable way for someone sitting on a substantial crypto balance to generate extra income.

However, there are some major risks involved in this type of financing, so you’ll need to do your due diligence on any bitcoin lending platform (and how it determines the credibility of lenders and borrowers) before signing up.

Before you dive head-first into bitcoin borrowing, check out your other personal loan options to decide which approach best fits your needs.


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Disclaimer: Cryptocurrencies are speculative, complex and involve significant risks – they are highly volatile and sensitive to secondary activity. Performance is unpredictable and past performance is no guarantee of future performance. Consider your own circumstances, and obtain your own advice, before relying on this information. You should also verify the nature of any product or service (including its legal status and relevant regulatory requirements) and consult the relevant Regulators' websites before making any decision. Finder, or the author, may have holdings in the cryptocurrencies discussed.

Image: Shutterstock

Disclosure: At the time of writing, the author holds ADA, ICX, IOTA, POWR and XLM.

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