What are crypto loans?

Crypto loans are secured loans that use cryptocurrency as collateral. These loans work similarly to a mortgage or auto loan, except your cryptocurrency secures the loan instead of your house or car. You can get a crypto loan for cash or a stablecoin cryptocurrency, depending on the lender.

What are the risks of crypto loans?

But crypto loans come with inherent risks, like requiring additional collateral if the value of your crypto goes down and high penalties for missed payments. There are 2 types of crypto loans: CeFi and DeFi. Centralized Finance, or CeFi, loans are custodial crypto loans where a lender has control over your crypto during the repayment term.

What is the LTV of a crypto loan?

The LTV (Loan to Value) stipulated at crypto loan sites refers to the amount of capital that you can borrow in relation to the size of your collateral. For example, at Crypto.com, you can access LTVs of up to 50%. And as such, should your security deposit amount to $2,000 in Bitcoin, you can receive a loan of up to $1,000.

Can you apply for a crypto loan on the same day?

This, in effect, widens the number of potential applicants who can successfully apply for and receive a crypto loan. To have your application for a loan approved as quickly as the same day, you’ll need a few key items.