Bitcoin Loans, No Price Liquidations
Strike Introduces Bitcoin Loans Protecting Against Price-Triggered Liquidations
Anonymous
Key Points
1
Strike’s volatility-proof bitcoin-backed loans are a licensed lender operating under U.S. money-transmission and lending registrations, i.e., they are regulated offerings rather than unregulated products.
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The product sets a minimum loan size of $10,000 and is available across most U.S. states to both individual and corporate borrowers.
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Strike operates in a broader market with other players offering bitcoin-backed loans, including Binance, Coinbase, Nexo, and Xapo Bank.
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CEO Jack Mallers has framed the product with explicit claims such as: 'No margin calls. No price liquidations. No matter how far bitcoin falls, your bitcoin doesn’t move.'
Strike has launched what it calls "volatility-proof" Bitcoin-backed loans — a product designed to survive even an 80% crash in Bitcoin's price without forcing borrowers to sell their collateral. CEO Jack Mallers put it bluntly: "No margin calls. No price liquidations. No matter how far bitcoin falls, your bitcoin doesn't move," according to CryptoTimes.
The move directly responds to Strike's troubled May 2025 loan rollout, when a 54% Bitcoin price drop triggered widespread liquidations. The new product shifts the trigger away from price and onto payment behavior — but critics say it is not entirely liquidation-proof, according to CCN.
How the New Loan Structure Actually Works
The loans carry a maximum loan-to-value ratio of 45%. That means a borrower must put up at least $100 in Bitcoin to get $45 in cash. The minimum loan size is $10,000, and six-month terms apply. CoinPaper reports the product is available to both individuals and businesses across most U.S. states.
Instead of liquidating collateral when Bitcoin's price drops, Strike watches whether borrowers make their payments. Miss a payment, and there is a 10-day grace period. After that, collateral can be partially liquidated — not because of price, but because of non-payment, according to Bitcoin Foundation.
Borrowers Pay a Premium to Skip Margin Calls
The annual percentage rate on the new product runs from 10.7% to 14.2%. That is 2.95 percentage points higher than Strike's standard loan offering. Bitcoin Foundation says the extra cost funds hedging strategies that let Strike absorb Bitcoin price swings without passing the risk to borrowers.
The tradeoff is clear: borrowers get peace of mind on price swings, but they pay more and must put up more collateral than with a typical crypto loan. The shorter six-month term also means less flexibility compared to some rival products, according to CoinCodex.
Critics Say 'Liquidation-Proof' Claim Has Fine Print
Analysts note the product is not truly liquidation-proof. Collateral can still be sold if a borrower misses payments past the 10-day grace window. The risk does not disappear — it shifts from Bitcoin's price to the borrower's cash flow and payment discipline, CCN reported.
Strike operates in a crowded space. Competitors including Binance, Coinbase, Nexo, and Xapo Bank all offer Bitcoin-backed lending products. Whether Strike's premium rate is worth the price-liquidation protection will depend on how volatile Bitcoin remains — and how reliably borrowers can make monthly payments, according to CryptoTimes.
Strike's Regulatory Standing Sets It Apart
Unlike many crypto lenders that operated outside traditional oversight, Strike holds U.S. money-transmission and lending registrations. That makes this a regulated product — not a gray-market offering. CoinCodex notes the distinction matters given the collapse of unregulated crypto lenders like Celsius and BlockFi in 2022.
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