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Crypto-Backed Loans In Australia: How They Work & What You Need To Know
02 Oct 20243min
As cryptocurrency becomes increasingly integrated into mainstream finance, investors are exploring innovative ways to unlock value from their digital assets. One option gaining popularity is Crypto-backed Loans.
But what are Crypto-backed Loans, and are they the right credit solution for your financial profile?
Here, we’ll explore how Crypto-backed Loans in Australia work, what they can be used for and where you can apply for a competitive cryptocurrency loan in Australia.
How cryptocurrency has made its way into everyday finance
Cryptocurrencies have come a long way from their inception as niche digital assets. Today, they are widely recognised and accepted, from crypto ATMs to merchants accepting tokens as a payment method.
And as the crypto market matures, financial services tailored to digital assets have emerged, including Crypto-backed Loans. These loans allow investors to leverage their cryptocurrency holdings without selling them, providing liquidity while retaining ownership of their assets.
How cryptocurrency has made its way into everyday finance
Cryptocurrencies have come a long way from their inception as niche digital assets. Today, they are widely recognised and accepted, from crypto ATMs to merchants accepting tokens as a payment method.
And as the crypto market matures, financial services tailored to digital assets have emerged, including Crypto-backed Loans. These loans allow investors to leverage their cryptocurrency holdings without selling them, providing liquidity while retaining ownership of their assets.
The ins and outs of Crypto-backed Loans in Australia — what are they and how they work
Crypto-backed Loans are secured loans where digital assets like Bitcoin or Ethereum are used as security. Here’s a step-by-step breakdown of how they work:
- Security submission — The borrower applies for a loan, pledging a certain amount of cryptocurrency as security to the lender. The lending platform holds this security in a secure wallet, segregated away from the exchange.
- Loan approval and settlement — Based on the value of the security, the lender approves the loan amount. The loan is then settled in Australian dollars (AUD).
- Loan Repayments
Fixed Term — The borrower begins making regular loan repayments on the loan where the interest rate depends on the platform’s lending requirements.
Line of Credit — The facility is open and may be managed by the borrower on their terms, until 12 months is up and the loan must be repaid or rolled over pending approval.
- Repayments cease, and security is returned — Upon repaying the loan in full, the security is returned to the borrower. Should the borrower default, the lender can liquidate the security to recover the loan amount.
What can you use a Crypto-backed Loan for?
Crypto-backed Loans in Australia offer great flexibility and can be used for various purposes, similar to traditional personal loans. Here are some common uses of cryptocurrency loans in Australia:
- Vehicle Upgrade — Block Earner loans are a fast, flexible way to fund your car, truck, or motorbike upgrade without selling your digital assets.
- Travel — Crypto-backed Loans allow you to fund your dream vacation without selling your crypto assets.
- Wedding — Finance your wedding expenses and host your big day exactly how you want it, all while holding onto your crypto for future gains.
- Home renovations — Use a Crypto-backed Loan to upgrade your home, increasing its value without liquidating your crypto holdings.
- Debt consolidation — Combine multiple debts into a single loan, simplifying repayments and reducing the interest you pay.
- Education — Pay for university fees or other educational expenses with a crypto-backed loan, investing in your future without touching your crypto savings.
Introducing the Block Earner Bitcoin and Ethereum crypto-backed loan
At Block Earner, we like to stay on top of the latest movements within the crypto market, so we can continue bringing utility to crypto holdings. We’re proud to offer a seamless and fast way to leverage your Bitcoin or Ethereum for loans in Australia.
Our platform is designed to provide quick liquidity access while ensuring your assets remain secure. Here’s what you can expect with a Block Earner Crypto-backed Loan:
- Competitive fixed interest rates — We offer attractive fixed interest rates of 9.50% (11.93% comparison rate*) for our Bitcoin or Ethereum Crypto-backed Loans, making it affordable to borrow against your crypto assets.
- Access up to 33% of your crypto’s value — Block Earner allows borrowers to borrow up to 33% of the value of the Bitcoin or Ethereum in your account, giving you ample access to the funding you need. Depending on your circumstances we may lend up to 50% LVR.
- Flexible loan terms — Block Earner understands that every investor has a different way of managing money, so we offer flexible loan terms and repayment options. With a Block Earner Crypto-backed Loan, you can repay your loan on any schedule or in full at the end of 12 months, ensuring you have a solution that best fits your lifestyle.
- Secure security management — Your security is stored securely, ensuring the safety of your digital assets throughout the loan term. As we hold your crypto, you’ll also maintain exposure to the crypto market, ensuring you continue to reap the benefits of price movements.
- Simple application process — Our user-friendly platform makes it easy to apply for a loan and get approved quickly. More often than not, approved applications received before midday are settled the same day.
Get started with Block Earner today
At Block Earner, we're here to support you on your journey, whether you're ready to apply for a crypto-backed loan or just want to explore your options. If you're curious about how much you can borrow, our loan calculator is available to give you a clear estimate in just a few clicks.
If you'd prefer to speak with one of our specialists, feel free to book a call with our expert team, who are ready to guide you through the process and answer any questions you may have.
Make your crypto portfolio go further with Block Earner. With more than 300 supported cryptocurrencies, competitive rates and competitive trading fees, we’re proud to be the home of crypto traders nationwide. Recognised for our innovation, we've earned recognition with awards like the WeMoney Innovation Award for Lending Innovation of the Year and Excellence in Blockchain/Distributed Ledger at the 2024 Finnies Awards, ensuring that you’re trading with a trusted and award-winning platform.
Create an account with Block Earner and submit your application for a Crypto-backed Loan today. If you have any questions about Crypto-backed Loans, please don’t hesitate to contact us.
