Xapo Bank, serving as a wealth manager for Bitcoin long-term holders, has announced the availability of BTC-backed loans reaching up to $1 million.
Key Highlights:
- A conservative loan-to-value ratio of 20%-40% ensures the security of customers’ Bitcoin, with a loan health tracker offering real-time updates on loan conditions.
- Xapo provides repayment options of 30, 90, 180, or 365 days without penalties for early payments.
In a time of fluctuating trust in crypto lending due to previous collapses and bankruptcies, Xapo is stepping in to revitalize the market. CEO Seamus Rocca emphasizes the distinction of their wealth management approach compared to traditional exchanges that typically foster trading environments.
He stated, “If an exchange is offering you secured lending, it’s to encourage leverage… unless you’re a professional investor, the risk of loss is very high.”
With a focus on safeguarding the loan against Bitcoin’s volatility, Rocca explained, “A 20%-40% loan-to-value ratio means that Bitcoin would need to depreciate below $40,000 for loans to be at risk.”
The initiative is particularly tailored for individuals seeking funds for purchases such as properties or vehicles, while still maintaining their Bitcoin holdings. Rocca elaborated, “If you’re a Bitcoin holder expecting value increases, selling any is a tough decision—life expenses still come up, and accessing liquidity through your trusted institution is vital.”
