Xapo Bank has rolled out a bitcoin-backed loan service that allows eligible members to borrow U.S. dollars without selling their BTC. Available through the Xapo Bank app, the new product offers loan sizes of up to $1 million, giving long-term bitcoin holders a way to unlock liquidity while keeping their market exposure intact.
A credit option for investors who do not want to sell
According to the bank, qualified members with sufficient bitcoin holdings can use an in-app calculator to estimate their borrowing capacity before applying. During the application process, users can choose their preferred loan amount and review the total repayment figure as well as the applicable interest rate, a structure Xapo says is designed to improve transparency.
Once approved, the loan proceeds are deposited into the member’s USD bank account, while the pledged bitcoin remains securely held as collateral. The service is positioned as an alternative for investors who need cash but do not want to liquidate their crypto assets.
Conservative structure aimed at risk control
Xapo Bank CEO Seamus Rocca said many long-term bitcoin holders have avoided crypto-backed lending after seeing predatory practices and unreliable products in the broader market. To differentiate its offering, the bank said it is using a relatively conservative loan-to-value ratio of 20% to 40%, along with automated repayment options and a Loan Health Tracker for real-time monitoring.
The repayment framework includes terms of 30, 90, 180, or 365 days. Borrowers can also repay early with no penalties or early repayment fees, which may help reduce overall borrowing costs. Members seeking larger facilities can speak with account managers for personalized assessments.
Regulated push into bitcoin-based banking services
Xapo Bank said it operates under the supervision of the Gibraltar Financial Services Commission. With this launch, the institution is further expanding its suite of bitcoin-focused financial services while emphasizing compliance, visibility, and lower leverage. The new loan product reflects a broader effort to offer regulated credit solutions to crypto investors who prioritize both liquidity access and asset retention.