The new lending product is designed for long-term Bitcoin hodlers who want to access cash while keeping their BTC, Xapo Bank CEO Seamus Rocca told Cointelegraph.“Unlike traditional assets, Bitcoin is an ideal form of collateral — it is borderless, highly liquid, available 24/7, and easily divisible, making it uniquely suited for lending,” Rocca said.
Source: Xapo Bank“Borrowers today exercise greater caution, prioritizing platforms with a proven track record in Bitcoin custody and those that offer secure, transparent solutions — especially ones that do not engage in rehypothecation,” Rocca said, adding:“At the same time, demand for Bitcoin-backed loans is on the rise, particularly among high-net-worth individuals and institutional investors who seek liquidity without selling their Bitcoin holdings.”In addition to removing asset rehypothecation and MPC security, Xapo offers risk management tools and proactive protection to prevent automatic liquidations.
The crisis came amid the historic Terra crash and a subsequent bear market that triggered the collapses of major lending providers like Celsius and BlockFi.“The collapse of Celsius, BlockFi, and other centralized lenders significantly eroded trust in the crypto lending space,” Xapo Bank CEO told Cointelegraph.
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