Xapo Bank Offers Bitcoin-Backed Loans Up to $1 Million, Joining Growing Market

Xapo Bank, based in Gibraltar, is now offering Bitcoin-backed loans, allowing customers to borrow up to 40% of their BTC collateral, with a maximum loan amount of $1 million. These loans have zero fees and a variable interest rate linked to US Federal Reserve rates, but are not available in the UK or Australia. Approved loans are accessible within a minute and can be used via debit cards, bank, or crypto transfers, with flexible repayment schedules within 30 to 365 days. While Coinbase previously offered similar loans but paused them in 2023, they have since reintroduced them. The Bitcoin loan market is expected to grow from $8.58 billion to $45.27 billion by 2029, at a CAGR of 26.4%. Xapo Bank, established in 2013 as a custodial Bitcoin wallet, requires customers to use its wallet to access the loans, holding the BTC collateral in its Bitcoin Vault until the loan is repaid.