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- Crypto Loans Explained: 9-Hour Funding vs 45 Days
Crypto Loans Explained: 9-Hour Funding vs 45 Days
Crypto-backed loans are revolutionizing real estate transactions with 9.6-hour average funding times. Here's exactly how these loans work and why they're experiencing 333% growth.
The Basic Mechanism
Borrowers post Bitcoin or Ethereum as collateral without selling it, avoiding capital gains taxes. They receive cash at a 50% loan-to-value ratio—meaning $500,000 cash for $1 million in Bitcoin collateral.
Traditional Mortgage: 30-45 days, credit checks, income verification
Crypto-Backed Loan: 9.6 hours, no credit check, collateral-based
Step-by-Step Process
Application: Submit crypto wallet verification (30 minutes)
Valuation: Platform assesses crypto holdings (1 hour)
Terms: Receive loan offer at 50% LTV (2 hours)
Funding: Cash wired to escrow (6-8 hours)
Risk Management Features
Platforms protect both parties through automated monitoring:
60% LTV: Warning notifications sent
70% LTV: Margin call for additional collateral
80% LTV: Automatic liquidation triggered
Important: Property ownership remains intact even if crypto is liquidated—only the loan balance is settled.
Why Clients Choose This Option
Beyond speed, crypto loans offer interest-only payments, no prepayment penalties, and qualification based on assets rather than income. Average loan size is $167,000, with projections exceeding $1 billion in 2025.
Understanding these mechanics helps agents confidently guide crypto clients through innovative financing options that traditional lenders can't match.