Borrow Cash While Holding Your Crypto

1st Capital Financial’s marketplace currently supports Ether (ETH), Solana (SOL), Aave (AAVE), Coinbase Wrapped Bitcoin (cbBTC), Coinbase Wrapped Staked ETH (cbETH), Chainlink (LINK), Threshold Bitcoin (tBTC), Uniswap (UNI), Tether (USDT), Wrapped Bitcoin (WBTC), and LIDO Wrapped Staked ETH (stETH). Collateral options vary based on the protocol and network. More eligible assets will be available soon.

A loan-to-value (LTV) ratio is equal to your loan amount divided by the value of your collateral. Crypto-backed loans are “over-collateralized” as a buffer to protect borrowers from liquidation events. LTV ratios determine how much you can borrow and your level of risk exposure. They’re also updated in real time, so you should pay close attention to LTV before and after taking out a crypto-backed loan.

Not at all! There’s no hard or soft credit check when you apply for a crypto-backed loan with any of the lending protocols supported in our marketplace, and DeFi lenders don’t report to credit agencies.

A cryptocurrency (“crypto”) loan allows you to collateralize your assets and receive up to 86% [or more] of the value in USDC or USDT instantly. Simply input the amount you want to borrow, the stablecoin you want to receive, and the crypto asset you want to collateralize. Then, shop and compare competitive interest rates and reward offers from multiple lending protocols. You set the terms of your loan and retain custody and ownership with a smart wallet we provide you. You’re able to manage, modify, or refinance your loan anytime in a few clicks.

Our platform currently supports four decentralized finance (DeFi) lending protocols, including Aave V3 (Ethereum, Base, Optimism, and Polygon), Compound III (Ethereum, Base, Optimism, and Polygon), MarginFi V2 (Solana), and Morpho V2 (Ethereum and Base). More protocols and networks will be available soon.

Decentralized finance (DeFi) lending protocols utilize “floating” interest rates that fluctuate in real-time based on market conditions. This is markedly different from variable interest rates in conventional lending, which are pegged to a benchmark or index (e.g., the Federal Reserve’s prime rate or optional peg rate). In DeFi lending, floating interest rates are calculated formulaically by lending protocols. These rates are dynamic, responsive, and often lower than those seen in centralized finance (CeFi) or conventional loans.

Borrowing against crypto assets is not considered a taxable event so long as they are not converted or sold under current Internal Revenue Service (IRS) guidelines. Notably, the IRS has not issued guidance for wrapped tokens. While the tax implications are generally favorable, borrowers should consult with a tax professional for advice and further insight.

Any business entity, entrepreneur, or individual with cryptocurrency (“crypto”) assets can apply for a loan. There are no additional criteria or credit requirements.

If the balance of your loan exceeds the maximum loan-to-value (LTV) ratio or “liquidation threshold,” whether it’s because you choose not to repay or for another reason, your collateral could be liquidated, and the lending protocol may collect a fee. Liquidation events and fees are easy to avoid so long as you monitor your LTV and pay the interest or deposit more collateral. We recommend you set up email and text alerts to reduce risk.