Understanding Crypto Loans: A Beginner's Guide to Borrowing Against Your Digital Assets

Crypto loans represent an innovative financial solution designed to unlock liquidity without requiring you to sell your holdings. Whether you’re convinced your assets will appreciate and prefer to hold long-term, or simply need immediate funds, crypto loan services offer an elegant way to bridge the gap. By depositing your cryptocurrency as collateral, you maintain ownership of your positions while accessing the capital you need. This guide walks you through every stage of the crypto loan journey, from your first borrow to managing advanced features.

Why Choose a Crypto Loan Over Selling?

The core advantage of a crypto loan is simple: you keep your assets while accessing cash. When you sell cryptocurrency to raise funds, you trigger tax events, lock in current prices, and potentially miss future appreciation. A crypto loan lets you borrow against your holdings at competitive interest rates—both flexible and fixed options are available—while your collateral continues to work for you. The service operates on an overcollateralized basis, meaning you deposit more collateral than you borrow, protecting both you and the lender from market volatility.

Starting Your First Crypto Loan: A Step-by-Step Approach

Getting Started: Accessing the Borrowing Interface

Begin by logging into your account and navigating to the Finance or Lending section. Look for the Crypto Loans product area, where you’ll discover both flexible-rate and fixed-rate borrowing options. The interface displays available assets, durations, and current interest rates. Select the asset you want to borrow and review the options that match your needs.

Initiating Your Borrowing Position

When you’re ready to proceed, you’ll encounter two primary choices: a flexible-rate loan or a fixed-rate loan. Each serves different strategies.

For a Flexible-Rate Crypto Loan:

The flexible-rate option provides adaptability. When you place an order, the system shows you the best current interest rate available. You can specify your desired loan amount—or click a “Max” button to borrow the maximum amount permitted based on your collateral value. Premium members (VIP users) can request higher borrowing limits through a dedicated benefit option. The system automatically calculates your loan-to-value ratio (LTV), which measures the relationship between your borrowed amount and collateral value. It also displays both hourly and annual interest rates, plus your estimated daily interest charge. This flexibility means your interest rate may shift as market conditions change.

For a Fixed-Rate Crypto Loan:

With fixed-rate borrowing, you know exactly what you’ll pay in interest for the entire loan period. Enter your desired loan amount and specify your expected interest rate. Select your collateral asset from those available in your account. The system presents two convenient options: enable Auto-Repay to have assets automatically deducted from your account on the settlement date (protecting you from missed payments), or choose to convert your fixed-rate loan into a flexible-rate loan once it matures. This gives you strategic flexibility as market conditions evolve.

Important Details About Interest and Fees:

Interest on your crypto loan is charged upfront when the order is matched. Once funded, you receive the borrowed amount minus the interest charge directly to your account. You can repay anytime, though prepaid interest isn’t refundable. If your loan becomes overdue, a penalty of three times the normal interest rate automatically accrues hourly during the grace period. Should you miss the final deadline, your collateral is automatically liquidated to settle the debt, plus a 2% liquidation fee is applied. A repayment conversion fee also applies when collateral is sold to repay your loan—this fee is the higher of either the collateral asset’s rate or the debt asset’s rate.

One important nuance: a single borrowing order can match with multiple supply orders over time, which means you might have multiple settlement dates for a single crypto loan.

Monitoring Your Crypto Loan Portfolio

Once your crypto loan is active, you’ll want to track its progress. Your dashboard provides a comprehensive overview organized into four key sections:

Total Debt displays all assets you’ve borrowed, separated by flexible and fixed-rate loans. You’ll see floating interest figures for flexible loans and fixed figures for fixed-rate loans.

Funding shows loan orders currently in the matching process—they’re active but not yet fully executed. Think of this as your “pending” section.

Borrowing lists all active loan orders that have already been matched and are currently accruing interest.

Collateral itemizes every asset you’ve pledged as security, showing both quantity and USD value. From here, you can adjust your collateral at any time.

To access a detailed order history, navigate to the Loan Orders section within your dashboard. You can filter by asset type or time period to find exactly what you’re looking for. This section displays complete information about each crypto loan, including current repayment status, accumulated interest, collateral details, and more.

Managing Repayment of Your Crypto Loan

Repaying your crypto loan is straightforward and flexible. From your overview dashboard, locate the specific loan you want to settle and select Repay. Alternatively, navigate directly to your Orders page and choose repayment from there.

If you hold both fixed and flexible-rate loans, you have options. You can repay all liabilities at once, or switch between “Flexible,” “Fixed,” or “All” sections to target specific loans. Note that the system prioritizes repaying flexible-rate loans first, followed by fixed-rate loans. You may also select multiple collateral types to use for a single repayment.

Repayment Flexibility and Fees:

You’re not required to repay the entire crypto loan at once. Both flexible and fixed loans permit partial repayments. For flexible-rate loans, interest calculations are based on your actual borrowing duration—any period shorter than one hour rounds up to a full hour for billing purposes. For fixed-rate loans, interest is charged upfront when you confirm the loan; early repayment doesn’t recover this prepaid interest.

If you’ve enabled Auto-Repay for your fixed-rate crypto loan, the system automatically withdraws funds from your account on the settlement date. This prevents missed payments and overdue penalties, but ensure your account has sufficient balance—if it doesn’t, the automatic repayment will fail.

When you make a repayment, funds are applied first to any accumulated interest, then to the borrowed principal. To manage market impact from large conversions, there’s a per-repayment limit of approximately $300,000 USD or equivalent; this limit may adjust based on market conditions and risk management needs.

You can also set reminders for upcoming due dates. From the Crypto Loans homepage, click the edit icon next to “Expiring Soon” in your dashboard to specify how many days before maturity you’d like to be notified.

Extending Your Crypto Loan Term: The Renewal Option

If your crypto loan is performing well and you want to continue, the Renewal function allows you to extend it without closing and reopening. Renewals are available for fully repaid orders with a balance greater than zero, provided there’s at least 6 hours until maturity. Each loan contract can be renewed up to 5 times maximum.

To renew, locate your loan in the Overview Dashboard and select Renew. Alternatively, access the Orders page and find the loan there. You’ll need to confirm your collateral for the renewal, and the system will recalculate your LTV and display the new repayment due date. Once you approve, click Renew to execute the extension.

Your renewal history is preserved for your records. Within the Fixed-Rate Loan section of your loan orders, you can access your Renewal Records. Click “Detail” on any renewal to see a breakdown of what occurred under that specific loan contract.

Optimizing Collateral for Your Crypto Loan

As market conditions change, managing your collateral becomes important for controlling your risk exposure. Your collateral directly influences your Loan-to-Value (LTV) ratio—the percentage of your collateral’s value that you’ve borrowed against.

Increasing Your Collateral

To add more collateral to your crypto loan, visit the Collateral section of your Overview Dashboard and select Adjust. Or use the “Add Collateral” button in the upper right. Navigate to the Increase Collateral tab and specify how much you want to deposit. Click “Max” to contribute all available funds from your account. Adding collateral reduces your LTV, which lowers your liquidation risk. This is especially useful if you’re concerned about market volatility or want to borrow larger amounts.

Reducing Your Collateral

To withdraw collateral, select the Reduce Collateral tab. You can remove a specified amount or click “Max” to withdraw the maximum reduction quantity—the amount that brings your LTV back to its initial level (typically 80%). Note that collateral can only be reduced when your current LTV is below the initial LTV threshold.

Before any adjustment takes effect, review the details carefully and confirm the transaction.

Understanding Key Metrics: LTV and Liquidation

Your LTV—Loan-to-Value ratio—is calculated based on Cross Margin mode, where your collateral assets back all your active loans combined. The Initial LTV is typically set at 80%, meaning the total value of your borrowed assets plus accrued interest cannot exceed 80% of your total collateral value (after applying collateral value ratios).

If your collateral value drops due to market movements, your LTV can rise toward dangerous levels. If it reaches critical thresholds, liquidation occurs automatically: your collateral is sold to repay the crypto loan, plus a 2% liquidation fee and any overdue penalties are deducted. This mechanism protects both you and the platform from excessive risk.

Putting It All Together

A crypto loan is a powerful financial tool for maintaining your long-term positions while accessing needed liquidity. Whether you’re using it short-term for immediate cash flow or strategically for portfolio management, the platform provides clear controls and transparency. Start with a small crypto loan to familiarize yourself with the mechanics, then scale up as you gain confidence. Remember to monitor your LTV, set repayment reminders, and adjust your collateral as market conditions warrant.

For additional information on crypto loans, including risk management strategies and frequently asked questions, consult the comprehensive FAQ and technical documentation available within your account.