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What Are Crypto Loans?

Crypto loans let you borrow money (like USDT) using cryptocurrency (like Bitcoin or Ethereum) as collateral, so you don’t have to sell your crypto. DeFi platforms like Aave use smart contracts for loans, while centralized platforms like Nexo are easier for beginners.

Key Terms

• APR: Yearly cost of the loan, including interest and fees (e.g., 10% APR = per 0 borrowed annually).
• LTV: Loan amount compared to collateral value (e.g., ,000 loan with ,000 collateral = 50% LTV).
• Loan Term: How long you can keep the loan. Flexible or unlimited means repay anytime.
• Price Down Limit: The price at which collateral is sold if its value drops (e.g., BTC at ,000 limit when price is 8,000).

Fair Terms (July 2025)

Fair terms for crypto loans, especially in DeFi, include:

• APR: 3-12% (e.g., Aave: 5-10%, Nexo: 3-12%). Higher rates like 21% are costly.
• LTV: 50-70%, balancing loan size and risk.
• Loan Term: Flexible or unlimited, common in DeFi and platforms like CoinRabbit.
• Price Drop Buffer: 30-50% (e.g., safe until BTC drops 50% from 8,000).
• Processing: Instant or same-day, no credit checks.

Top Platforms

These products are smart contracts.

• Aave (DeFi): 5-10% APR, 70-85% LTV, instant. Needs wallet knowledge.
• Rocko (DeFi): 0-13% APR, up to 85% LTV, flexible.
• Nexo: 3-12% APR, 50% LTV, user-friendly.
• YouHodler: 3-12% APR, up to 90% LTV, instant.

Risks to Know

Crypto loans carry risks: if your collateral’s value drops (e.g., BTC to ,000), it may be sold. DeFi platforms have smart contract risks, while centralized ones may have custody risks. Always check platform security and monitor crypto prices.