Xapo Bank is offering Bitcoin-backed loans, letting people borrow money using their Bitcoin as collateral without selling it. This shows growing acceptance of crypto as a real asset.
Xapo’s Bitcoin-Backed Loan Details
You can borrow up to 40% of your Bitcoin’s value, with a maximum loan of $1 million, and no fees! However, there’s a variable interest rate tied to US Federal Reserve rates, and it’s not available to everyone (UK and Australian residents are excluded). Loans are disbursed quickly and can be accessed via debit card, bank transfer, or crypto transfer. You can repay early without penalty, but you have to repay within a set timeframe (30, 90, 180, or 365 days).
Is This a Sign of a Healthy Market?
Absolutely! Experts predict huge growth in the Bitcoin loan market – from $8.58 billion now to a projected $45.27 billion by 2029. While Coinbase briefly paused its Bitcoin-backed loans in 2023, they’ve brought them back, and are even hinting at adding other altcoins as collateral options. This all points to increased confidence in Bitcoin.
Custodial vs. Non-Custodial Wallets
Using a Bitcoin-backed loan means using a custodial wallet like Xapo’s. This means the bank holds your private keys, offering security but also leaving you vulnerable to potential hacks. A non-custodial wallet, like the Best Wallet app, gives you complete control of your private keys, making it a safer option, though it comes with its own set of responsibilities. Remember, a recent report showed that private key compromises were responsible for 44% of crypto theft in 2024.
The Best Wallet Token ($BEST)
The Best Wallet app is a non-custodial, multi-chain wallet aiming to become a major player in the crypto wallet market. To help achieve this, they’ve launched their own token, $BEST. With a 50% monthly user growth rate and a successful presale raising over $11 million, they’re making significant progress. The token currently costs $0.0244, but always do your own research (DYOR) before investing.
