Bitcoin-Backed Loans Now Available through Strike
Bitcoin-backed loan service introduced by digital payment platform Strike using Bitcoin as collateral
In an exciting turn-up, digital payments platform Strike has announced the launch of Bitcoin-backed loans for eligible US customers. These loans enable users to access cash without parting ways with their Bitcoins, a move hailed by Strike's CEO, Jack Mallers. The new service is available to customers in 26 US states, with plans to expand to other regions, including Europe.
Mallers accentuated that the service aims to empower individuals to tap into their Bitcoin wealth without having to sell it. Through the new lending service, Strike customers can secure loans with at least a 12% Annual Percentage Rate (APR), using Bitcoin as collateral. This opportunity extends to individuals and companies seeking larger loans over $2 million, as Mallers hinted at further assessment.
Strike, a digital payments company, allows users to send, receive, and trade Bitcoin. Mallers is also the CEO of Twenty One, a Bitcoin treasury company financed via SPAC merger with backing from Tether, Bitfinex, Cantor Fitzgerald, and SoftBank. Strike played a crucial role in El Salvador's Bitcoin project, helping set up the infrastructure for Salvadorans to spend their cryptocurrency.
El Salvador made history in 2021 by becoming the first country to make Bitcoin a legal tender. However, the International Monetary Fund requested a rollback of the policy as part of a $1.4 billion loan agreement, leading to the rescinding of that law. Despite this, President Nayib Bukele has continued to accumulate Bitcoins.
Bitcoin-backed loans offer unique advantages to users. Eligible individuals can access cash without selling their Bitcoin, allowing them to maintain long-term investment strategies. Additionally, the service charges no origination fees, making it a cost-effective alternative to traditional loans. However, risks associated with Bitcoin's price volatility are inherent, with potential margin calls or liquidations if the Bitcoin value drops.
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- Strike's new service allows users to access Bitcoin-backed loans, empowering them to tap into their Bitcoin wealth without selling it.
- Through the new lending service, eligible Strike customers can secure loans with at least a 12% Annual Percentage Rate (APR), using Bitcoin as collateral.
- Strike, a digital payments company, allows users to send, receive, and trade not only Bitcoin but also other cryptocurrencies, including Ethereum (Eth).
- Bitcoin-backed loans offer a cost-effective alternative to traditional loans, charging no origination fees, but the risks associated with Bitcoin's price volatility are a significant factor.
