Étienne Girard
Strike, the Bitcoin Lightning-powered payments app led by Jack Mallers, has announced the launch of its highly anticipated Bitcoin lending service, offering users a way to access liquidity without selling their BTC. The new feature, called Strike Lending, is now live for select U.S. users and is expected to expand to global markets soon.
“Access your wealth without giving up your Bitcoin — now you can,” said Mallers in a post on X, emphasizing Strike’s mission to make Bitcoin a more usable financial asset.
Strike’s entrance into crypto lending arrives at a time when the digital asset credit market is regaining momentum. Following a brutal crypto winter in 2022 — which saw major lenders like BlockFi, Celsius, and Genesis collapse — lending activity is resurging, fueled by platforms like Coinbase, Xapo, and now Strike.
According to Galaxy Research, the total value of the crypto credit market is down 43% from its peak of $64.4 billion in late 2021. Still, CeFi lenders are holding strong, with Tether, Galaxy, and Ledn collectively managing $9.9 billion in loan books by Q4 2024.
How Strike Lending Works
Strike Lending allows both individuals and businesses to borrow USD or stablecoins using Bitcoin as collateral. The BTC is held by vetted capital partners, and the loans are structured with transparent terms:
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Loan amounts: Minimum of $75,000, capped at $2 million
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Loan term: 12 months
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Interest rate: Starting from 12% APR
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Fees: 0% origination and 0% early repayment
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Credit impact: No reporting to credit agencies
Borrowers can either make monthly payments or settle the full interest and principal at maturity. According to Strike’s FAQ, the platform retains legal responsibility for the collateral, even though it’s transferred to a third-party provider during the loan period.
“We partner only with trusted capital sources to offer competitive rates and secure lending,” Strike explained.
Why It Matters: Holding BTC While Leveraging Its Value
This lending model is designed for long-term Bitcoin holders who want to maintain exposure while unlocking its dollar value. As Mallers put it:
“If Bitcoin’s price grows faster than your borrowing cost, you’re gaining value even while in debt.”
The model reflects a broader trend in decentralized finance (DeFi), where collateralized crypto lending is booming. On Ethereum alone, the on-chain lending market has surpassed $34 billion, according to PRIME.
