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Strike has launched a Bitcoin-backed loan product that eliminates forced liquidations during price drops. The loans carry an annual percentage rate of up to 14.2% and allow borrowers to access up to 45% of their Bitcoin's value without margin calls. CEO Jack Mallers clarified the product is "volatility-proof, not liquidation-proof," meaning borrowers must still make scheduled payments. Missed payments trigger a 10-day grace period before partial liquidation occurs. The product is supported by a $2.1 billion credit facility built with Tether. Strike developed the offering after its May 2025 loan product triggered widespread liquidations when Bitcoin fell 54%. The launch coincides with Strike's proposed merger with Twenty-One Capital and Bitcoin miner Elektron Energy, which operates approximately 5% of the Bitcoin network's hashrate.

Strike launches Bitcoin loans without margin calls or liquidations. vivian 5 hours ago (Last updated: 5 hours ago) 4 minutes read * Strike has launched Bitcoin loans without margin calls or price-based liquidations. * Borrowers keep their Bitcoin as long as they make their loan payments. Strike has introduced a new Bitcoin-backed loan product that removes one of the biggest risks for crypto borrowers, margin calls and automatic liquidations caused by falling Bitcoin prices. The new lending option allows users to borrow against their Bitcoin without worrying that a market downturn will trigger the immediate sale of their collateral. However, borrowers must continue making their scheduled payments to keep their Bitcoin secure. Strike removes price-based liquidation risk. The new product follows Strike's first Bitcoin lending service, launched in May 2025, which led to numerous liquidations during a sharp Bitcoin market decline. Following customer feedback, the company redesigned the service to protect borrowers during periods of high volatility better. According to CEO Jack Mallers, Bitcoin price swings alone will no longer force borrowers to lose their collateral. Instead, customers can keep their Bitcoin regardless of how low its price falls, as long as they remain current on their loan payments. The approach is designed to help long-term Bitcoin holders access cash without being forced to sell their assets during market downturns. Higher interest rates pay for added protection. The added protection comes at a higher cost. Strike's new Bitcoin loans carry annual percentage rates ranging from 10.7% to 14.2%. By comparison, the company's standard Bitcoin-backed loans offer rates between 7.75% and 11.25%. Mallers explained that the higher interest helps fund hedging strategies that protect both the company and borrowers from market volatility. The loans also have a maximum loan-to-value ratio of 45%. This means someone pledging $100,000 worth of Bitcoin can borrow up to $45,000. Loan terms last six months, making them shorter than Strike's traditional lending product. Missed payments can still lead to liquidation. Although Bitcoin price declines will not trigger automatic liquidations, borrowers must continue making their loan payments. Strike gives customers a 10-day grace period after a missed payment, allowing them to either repay the amount due or contact the company to discuss their situation. If there is no response after the grace period, Strike may sell enough Bitcoin to recover the outstanding balance. Mallers said this is why the product is "volatility-proof" rather than completely "liquidation-proof," since missed payments can still result in collateral being sold. Bitcoin lending market continues to expand. The service is available in most US states for both individual and business borrowers. Personal loans require a minimum of $10,000, while eligible businesses in selected states can borrow from as little as $5,000. With this launch, Strike joins other major platforms, including Binance, Coinbase, Nexo, and Xapo Bank, in offering Bitcoin-backed lending services. Interest in crypto-backed lending continues to grow. Recent research from crypto lender Ledn found that while 88% of cryptocurrency investors would consider using Bitcoin-backed loans, only 14% currently use them. Strike's new product could help attract more borrowers by reducing the risk of market-driven liquidations. DISCLAIMER: The views and opinions expressed herein are solely those of the author and do not necessarily reflect the views of the publisher. The publisher does not endorse or guarantee the accuracy of any information presented in this article. Readers are encouraged to conduct further research and consult additional sources before making any decisions based on the content provided. Vivian Njoroge is a seasoned crypto and blockchain news writer with a passion for decoding the complexities of the digital financial world. Armed with a keen eye for emerging trends and a knack for simplifying intricate concepts, Vivian brings a unique blend of expertise and enthusiasm to her writing. Her articles, characterized by clarity and depth, aim to keep readers abreast of the ever-evolving landscape of cryptocurrencies and blockchain technology.

Strike launches 'volatility-proof' Bitcoin loans amid bear market, but at a cost. Cointelegraph.com News July 7, 2026 Bitcoin financial services platform Strike has launched a "volatility-proof" Bitcoin-backed loan that eliminates margin calls and forced liquidations amid the depths of a bear market, but only for those who can pay on time and handle a 14% interest rate. In an announcement on Tuesday, Strike CEO Jack Mallers said the offering came in response to broad customer feedback on Strike's first Bitcoin loan product, which launched in May 2025 and triggered many liquidations during a timeframe in which Bitcoin (BTC) dropped 54% from peak to trough. "No margin calls. No price liquidations. No matter how far bitcoin falls, your bitcoin doesn't move," Strike CEO Jack Mallers said of the new Bitcoin loan product. The trade-off is an expensive interest rate, a shorter six-month loan term, and an obligation to pay on time to avoid liquidation, Mallers said. Strike's Jack Mallers is presenting the new Bitcoin-backed loan product. Source: Jack Mallers The Bitcoin industry has spent the better part of a decade racing to build financial products that expand Bitcoin's use case beyond a savings technology. A report in June from crypto lending platform Ledn, however, found that while 88% of surveyed crypto investors said they would consider a crypto-backed loan, only 14% use them. Ledn said confidence in crypto-lending products and market volatility are among the main reasons for this 6-to-1 "crypto collateral gap" that has slowed adoption. Volatility has been one of the biggest obstacles behind that push, with Bitcoin dropping 30% or more in 10 of the past 12 years, while also experiencing a 50% or more drawdown four times since 2014, Mallers noted. Other crypto market participants offering Bitcoin-backed loans are Binance, Coinbase, Nexo and Xapo Bank. Strike charges double-digit interest. The maximum initial loan-to-value ratio for the volatility-proof loans is 45%, meaning that a customer who puts up $100,000 in Bitcoin as collateral can borrow up to $45,000, while the annual percentage rate (APR) is also 2.95 percentage points higher than Strike's standard loan product. "The secret sauce is that we're taking the extra charge that we're giving you guys and we're putting it on extra hedges in the market to protect all of us." Strike's standard Bitcoin loans charge an annual percentage rate between 7.75% and 11.25%, meaning the volatility-proof products could carry interest between 10.7% and 14.2%. "If you're OK with a slightly shorter term and a little bit higher of a fee, there is no price move that can liquidate you," Mallers said. Over the past year, Bitcoin has fallen 54% from its all-time high of $126,080 in October to $58,190 on June 25. Bitcoin investor Fred Krueger said the loan product "could eliminate one of Bitcoin's biggest structural problems: forced selling during market crashes." "Instead of volatility causing automatic liquidations, defaults would be driven by borrowers' inability to service debt rather than by temporary price swings," he said. "Great product for those who need near-term liquidity and don't want to risk liquidation," added Vibes Capital Management executive chairman Rob Topping, though he also acknowledged the 14% APR was expensive. Customers must pay up or face consequences. If a client misses a payment, they have 10 days to make the payment or contact Strike to explain their financial situation, Mallers said. Failing to pay after that 10-day period may mean Strike starts liquidating their Bitcoin to cover the overdue amount, Mallers warned. "If we don't hear from you for a few weeks, then I may have no choice but to sell off some of the Bitcoin because it seems like you're doing a hit-and-run." "That's why we call it 'volatility-proof,' not 'liquidation-proof,'" Mallers added. The Bitcoin loans are offered in most US states and can be taken out in both personal and business names. They can be used for new loans, refinancing or consolidating. While the minimum loan amount varies from state to state, the minimum loan offered through personal loans is $10,000, while businesses in certain states can access loans as low as $5,000. Features: Bitcoin miners are pivoting to AI, so why is the hashrate near ATHs? Cointelegraph is committed to independent, transparent journalism. This news article is produced in accordance with Cointelegraph's Editorial Policy and aims to provide accurate and timely information. Readers are encouraged to verify information independently.