The Bitcoin Onramp’s financial services firm has been associated with the ARCH loan platform to introduce a loan service backed by Bitcoin, companies announced.
The new product allows BTC holders to obtain loans while maintaining ownership of its assets, a movement aimed at investors who seek to access liquidity without selling their bitcoin (BTC).
The service provides bitcoin collateral loans, allowing provisions to use their holdings as security while receiving cash or stablecoins in return. When using bitcoin as a guarantee instead of selling it directly, borrowers can avoid tax profits taxes and maintain exposure to the possible assessment of the asset, according to the press release.
The Arch loan partner specializes in loans supported by assets and will handle the subscription and loan distribution. Onramp, which focuses on Bitcoin’s financial solutions, will integrate the service into its platform, which makes it accessible to users looking for an alternative to traditional financing.
Bitcoin backed loans are gaining popularity in this cycle as an alternative to traditional loans, especially among long -term BTC holders that prefer to retain their assets. This model has been used in various financial applications, from personal liquidity needs to institutional financing strategies.
Read more: Coinbase to offer loans backed by Bitcoin through Morpho
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