Eligible master-account users borrow up to 1,000 USDT against bitcoin, lock in a 0.5% fee through Sept. 3, then face 36% penalty interest after the term.
Binance launched a bitcoin-backed loan product on Aug. 4 with a 30-day term and no price-triggered liquidation during the initial period. The product, called Lite Loan, lets eligible master-account users borrow up to 1,000 USDT immediately by pledging bitcoin as collateral. A promotional 0.5% service fee remains available through Sept. 3.
"Borrowed funds are available immediately and can be used both on and off the Binance platform," the exchange said.
Borrowers pay a nonrefundable service fee deducted from the loan amount when funds are issued, with no additional interest charged during the initial 30-day term. The promotional rate applies to orders completed from Aug. 4 at 10:00 UTC through Sept. 3 at 09:59 UTC, after which the fee returns to 1%.
Eligible bitcoin held in a user's Spot or Funding Account is locked as collateral and enters Binance Simple Earn, where it continues generating yield while the loan remains outstanding. Users cannot withdraw or transfer the pledged bitcoin until they repay the full balance and recover the collateral through their Earn Account.
"No complex LTV monitoring, no price-triggered liquidation during the initial 30-day Loan Term, and your collateral keeps earning yield throughout the loan term," Binance said.
Binance pitches the 30-day structure as removing the need for active loan-to-value management while the loan runs. The wider Binance Loans platform includes Lite Loan alongside flexible-rate and fixed-rate products, with a separate VIP tier serving different borrowing sizes and repayment preferences.
The risk terms kick in once the window closes. Binance applies daily penalty interest at a fixed simple annual rate of 36% to the outstanding balance after expiration. The exchange sends a margin-call notification when loan-to-value reaches 85%. Liquidation begins at 91% or once the balance remains overdue for 30 days, whichever comes first.
Liquidation uses the position's collateral to repay the entire loan. Binance currently sets the liquidation fee at 0%, and the exchange may restore the standard 2% and apply a risk-based adjustment to each collateral asset's market value during the process.
Early and partial repayments carry no additional charges, using USDT or other eligible crypto assets. Across Binance Loans, collateral requirements, borrowing limits, repayment schedules, and loan-to-value calculations vary by product.
Lite Loan extends Binance's lending portfolio beyond its flexible-rate, fixed-rate, VIP, and institutional products, adding bitcoin-backed borrowing for users seeking smaller loans with fixed terms and simplified repayment. The exchange previously introduced institutional loans supporting pooled collateral and more than 400 collateral assets.
Other major exchanges are also expanding bitcoin-backed credit. Coinbase (Nasdaq: COIN) offers bitcoin-backed USDC loans with flexible repayment. Eligible users can borrow up to 5,000,000 USDC against bitcoin, or 1,000,000 USDC against ethereum. Loans against solana, cardano, XRP, litecoin, and dogecoin cap at 100,000 USDC, depending on the amount pledged. COIN carries an AlphaScala Alpha Score of 28 out of 100, a reading the platform labels Weak. Coinbase also notes transfer limits apply to all accounts as a financial safeguard.
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