Binance offers more than just crypto savings products—it also provides lending services! This guide explores Binance Crypto Loans, a feature allowing users to collateralize their crypto holdings to borrow other assets, enhancing liquidity for trading or investment flexibility.
What Are Binance Crypto Loans?
Binance Crypto Loans (Binance Loan) is a financial service offering flexible-rate and fixed-rate borrowing options. With over 120+ supported cryptocurrencies, users can borrow against their collateral (minimum ~$100 USD).
Key features:
- Collateralization: Pledge crypto (e.g., BNB, ETH) to borrow other assets (e.g., BTC, USDT) at 65–70% of collateral value.
- Usage: Borrowed funds function as spot assets—tradeable, withdrawable, or usable for staking/mining.
- Interest: Paid hourly; rates vary by asset and loan type.
Loan Summary Table
| Feature | Details |
|---|---|
| Loan Types | Flexible-rate, Fixed-rate (7/30 days) |
| Minimum Amount | ~$100 USD |
| Supported Assets | 120+ cryptocurrencies |
| Collateral Rate | 65–70% (varies by plan) |
| Liquidation LTV | 83–85% |
Pros and Cons of Binance Crypto Loans
Advantages
- Fast Access: No credit checks; loans are instant.
- User-Friendly: Simple interface for beginners.
- High Initial LTV: Borrow up to 70% of collateral value.
- Flexible Collateral: Use flexible savings assets (earn interest while borrowing).
Risks
- Liquidation Risk: Loans are overcollateralized; falling below LTV thresholds triggers liquidation.
- Leverage: Borrowing amplifies gains/losses.
- Platform Risk: Binance’s stability impacts loan safety.
- Single-Collateral Limitation: No multi-asset collateral (yet).
Step-by-Step Loan Process (Mobile App)
Step 1: Register and Fund Your Binance Account
- Sign up via Binance’s official site and complete KYC.
- Deposit crypto into your Spot Wallet.
Step 2: Navigate to Crypto Loans
- Go to
Finance>Crypto Loans.
Step 3: Choose Loan Type
- Select Flexible-rate (variable APR) or Fixed-rate (locked term).
Step 4: Enter Loan Details
- Input borrow amount (e.g., 200 USDT) or collateral quantity.
- System auto-calculates the counterpart (e.g., 285.76 BUSD collateral for 200 USDT).
- Confirm terms and submit.
👉 Start borrowing on Binance today!
Step 5: Loan Disbursement
- Funds deposit into your Spot Wallet; hourly interest accrues immediately.
Repayment Guide
- Open
Crypto Loans>Active Orders. Click Repay, enter amount (partial/full), and choose to:
- Retain collateral (lowers LTV) or
- Release collateral (LTV unchanged).
- Confirm repayment.
Understanding Loan-to-Value (LTV) Ratio
LTV = (Loan Value + Interest) / Collateral Value
Key Thresholds
| LTV Stage | Flexible-rate | Fixed-rate |
|---|---|---|
| Initial LTV | 70% | 65% |
| Margin Call | 78% | 75% |
| Liquidation | 85% | 83% |
- Liquidation: Partial (50% at 85%) or full (100% at 90% LTV).
Adjusting LTV Ratio
- Open
Active Orders>Adjust LTV. - Add Collateral: Lowers LTV, reduces liquidation risk.
- Remove Collateral: Raises LTV, increases risk.
Conclusion
Binance Crypto Loans provide liquidity without selling holdings. Key takeaways:
- Flexible-rate loans leverage earning assets (offset interest costs).
- Monitor LTV ratios to avoid liquidation.
- Ideal for traders/HODLers needing short-term capital.
Always assess risks—crypto loans involve leverage and platform dependencies.
FAQ Section
Q: What’s the minimum loan amount on Binance?
A: ~$100 USD, varying by cryptocurrency.
Q: Can I use multiple assets as collateral?
A: Not currently; only single-asset collateral is supported.
Q: How is interest calculated?
A: Hourly, based on the loan’s APR. Even partial hours count as full.
Q: What happens during liquidation?
A: Binance charges a 2% penalty fee and sells collateral to cover the debt.
Q: Are loan rates fixed?
A: Only for fixed-term loans (7/30 days). Flexible-rate loans fluctuate with market conditions.
👉 Explore Binance’s crypto loan features now!
Disclaimer: Crypto loans carry high risk. This guide is informational only—not financial advice. Conduct independent research before borrowing.