Bitcoin investors are increasingly choosing loans over selling their holdings, as institutional adoption and long-term confidence grow.
Xapo Bank’s CEO, Seamus Rocca, sees Bitcoin-backed loans as the next logical step as investor confidence grows. As Bitcoin’s price hovers between $95,000 and $97,000, more investors are choosing to borrow against their BTC instead of selling it.
Xapo Bank’s lending product, launched in March, allows clients to borrow up to $1 million using Bitcoin as collateral.
The demand for such loans is fuelled by a shift in market sentiment, with investors moving from short-term speculation to a longer-term outlook.
Rocca highlighted that institutional adoption, including Bitcoin ETFs, is contributing to this change in attitude. The bank offers flexible loan-to-value (LTV) ratios, allowing borrowers to access liquidity while keeping their BTC.
With conservative LTV levels, Bitcoin prices would need to drop significantly for borrowers to face liquidation, making this an appealing option for long-term holders.
The product helps investors manage emergency expenses without selling their Bitcoin. It’s enabling them to continue benefiting from potential price appreciation while maintaining liquidity.
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