English (en)

Bitcoin is volatile by design. Any lending model that ignores this reality is structurally unsound.

When Bitcoin is used as collateral, **Bitcoin price volatility directly affects** the health of the loan. Understanding how this dynamic works is essential before borrowing against Bitcoin.

The key variable is the Loan-to-Value ratio. As Bitcoin’s price declines, the value of the collateral decreases while the loan amount remains unchanged. This causes the LTV to rise.

To manage this risk, Bitcoin-backed loans include predefined thresholds that trigger margin calls. **What is a margin call?** A margin call is a request to restore collateral safety by either adding Bitcoin or repaying part of the loan.

Margin calls are not failures. They are safeguards designed to prevent liquidation. They give borrowers time and options to respond before the loan becomes unsafe.

[Liquidation](/blog/en/forced-liquidation) occurs only when margin calls are ignored or when market movements are too rapid to manage within the defined buffers. Liquidation protects lenders from under-collateralization but is generally the least desirable outcome for borrowers. Starting with end of Q1 we release the feature “delayed liquidation” to support borrowers and lenders in volatile markets. All details [here](/blog/en/product-update-delayed-liquidation-excess-collateral). 

At Debifi, the emphasis is on conservative initial LTVs, clear communication, and manual oversight rather than instant automated liquidation systems. This approach prioritizes stability over speed.

Borrowers must understand that Bitcoin-backed loans require active risk management. Passive borrowers who are unwilling or unable to respond to market movements should not use Bitcoin as collateral.

Bitcoin volatility does not make Bitcoin-backed loans inherently dangerous. Ignoring Bitcoin volatility does.

Responsible borrowing starts with conservative assumptions, sufficient buffers, and a realistic understanding of downside scenarios.


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Bitcoin Volatility, Margin Calls, and Liquidations Explained

In Bitcoin-backed lending, custody is not a technical detail. It is the foundation of trust.
Before considering interest rates, loan terms, or speed of execution, borrowers should ask a single, fundamental question: where is my Bitcoin held?
The history of Bitcoin lending provides many examples of what happens when this question is ignored. Opaque custody arrangements, rehypothecation, and unclear control structures have repeatedly led to losses for borrowers who believed their Bitcoin was “safe” until it wasn’t.

Bitcoin-backed loans require the borrower to temporarily give up direct control over their Bitcoin. This makes custody structure more important than in almost any other financial arrangement involving Bitcoin.

A robust Bitcoin custody setup must clearly answer three questions:
- Who controls the keys?
- Under what conditions can the Bitcoin move?
- What happens in extreme scenarios such as insolvency or legal disputes?

In poorly designed lending models, Bitcoin collateral is often reused, traded, or pledged elsewhere to generate additional yield. This introduces hidden counterparty risk. While such models may offer lower interest rates, they fundamentally change the risk profile of the loan.
At Debifi, Bitcoin collateral exists for one purpose only: securing the loan. It is not rehypothecated, traded, or used for yield generation. This conservative approach limits systemic risk and aligns incentives between borrower and lender.

Transparency is critical. Borrowers should understand not only where their Bitcoin is held, but also the legal and operational framework governing that custody. This includes clarity on jurisdiction, contractual rights, and dispute resolution mechanisms.

Another important consideration is the difference between custody and control. Even if Bitcoin is held securely, borrowers must understand who has authority to initiate transactions and under which predefined conditions. Clear rules reduce uncertainty during periods of market stress.
In Bitcoin-backed lending, trust is not created through branding or promises. It is created through structure, documentation, and clear boundaries.

Custody transparency does not eliminate risk, but it makes risk visible and manageable. For borrowers, this visibility is essential to making informed decisions.
Understanding custody is not optional. It is a prerequisite for responsible borrowing against Bitcoin.

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Where Your Bitcoin Is Held: Custody and Control in Bitcoin-Backed Loans

At Debifi, our mission is to provide the most secure bridge between your Bitcoin and the liquidity you need. We know that the market never sleeps and that volatility is part of the journey. That’s why we’ve rolled out a series of technical features designed to give you more control over your collateral and make the entire lending process smoother than ever.

Here is a breakdown of the latest features now live on the platform.

## Protection Against Flash Crashes: Delayed Liquidation  
Bitcoin’s price can be volatile, and short-term "dips" shouldn't force you out of your position. To protect borrowers from abrupt liquidations during sudden market fluctuations, we are introducing **_Delayed Liquidation_**.

- **The Safety Buffer:** Lenders can now include a delay period of 12, 24, 36, or 48 hours in their offers.  
- **Time to React:** If your Loan-to-Value (LTV) ratio hits a critical threshold, liquidation isn't triggered instantly. You now have a defined window to top up your collateral or partially repay the loan.  
- **Peace of Mind:** This feature is a game-changer for those who want to sleep soundly even in volatile market phases. Available for all new contracts.

## Maximize Capital Efficiency: Extract Excess Collateral  
When the Bitcoin price rises, you might find that you have significantly more capital locked in your multisig escrow than is actually required to secure your loan. With our new _**Extract Excess Collateral feature**_, you can reclaim that surplus.

- **Proactive Management:** You can now "over-collateralize" your loan in anticipation of volatility (e.g., before going on vacation) and simply withdraw the excess once the market stabilizes or you return.  
- **Keep Your Sats Liquid:** You don’t have to keep your capital tied up unnecessarily. Move your excess sats back to your own wallet while your loan contract remains active and secure.

## Speed & Automation: Save BTC Address
For our power users, every second counts. We have significantly optimized the process for collateral refunds and liquidation releases.

- **Eliminate the Wait:** Previously, the withdrawal process often paused while waiting for all parties to manually add their destination addresses.  
- **One-Click Withdrawals:** You can now save your preferred BTC addresses directly in your account profile. The system automatically retrieves these addresses when a transaction is required, drastically speeding up the signing and broadcasting process.  
- **Seamless Reusability:** Once saved, your addresses are ready for all future contracts \- ensuring a faster, error-free workflow.

## Transparent Pricing: Updated Origination Fees  
To keep our platform fair and competitive for both small and large-scale loans, we have updated our Origination Fee structure for all new contracts. The fee is now calculated transparently based on Loan Volume and Loan Duration.  
Base Fee (by Loan Volume):

- Up to $300,000: 1.5%  
- $300,001 to $1,000,000: 1.2%  
- Above $1,000,000: 1.0%

Additional Fee (by Loan Duration):

- Year 1: 0%  
- Year 2: \+0.3%  
- Year 3: \+0.6%

Example Calculation: 
A $500,000 loan for a 2-year term would result in a total origination fee of 1.5% (1.2% Base Fee \+ 0.3% Duration Fee).

## Conclusion

These updates reflect our commitment to making Debifi the premier choice for institutional and private Bitcoin holders. More protection, more speed, and full transparency.  
Log in to your dashboard today to explore these new features and optimize your borrowing strategy.  

Debifi Product Update: New Features introduced

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Product Update: Strengthening Security and Control for Your Bitcoin Loans

Bitcoin-backed loans are often discussed in simple terms, but their mechanics are frequently misunderstood. At their core, these loans are a form of collateralized lending where Bitcoin secures access to liquidity. Understanding how do Bitcoin loans work is essential before using Bitcoin as collateral.

A BTC-backed loan begins with collateral. The borrower pledges Bitcoin to secure a loan denominated in fiat currency or stablecoins. The amount that can be borrowed is determined by the Loan-to-Value ratio, commonly referred to as LTV.

LTV represents the relationship between the loan amount and the value of the Bitcoin collateral. For example, a 40% LTV means that for every $100 worth of Bitcoin pledged, $40 can be borrowed. Lower LTVs reduce risk but limit liquidity. Higher LTVs increase liquidity but raise exposure to Bitcoin price volatility.

Bitcoin’s volatility is the defining risk factor of using Bitcoin as collateral for a loan. When Bitcoin’s price declines, the value of the collateral decreases while the loan amount remains constant. As a result, the LTV increases.

To manage this risk, loans backed by Bitcoin  include predefined thresholds. When the LTV rises beyond certain levels, a margin call is triggered. A margin call requires the borrower to either add additional Bitcoin collateral or repay part of the loan to restore a safer LTV.
Margin calls are not liquidations. They are risk management mechanisms designed to protect both borrower and lender. Liquidation occurs only if margin calls are ignored or if market movements are too rapid to manage within predefined buffers.

The borrower continues to pay interest throughout the loan term. Once the loan principal and interest are fully repaid, the Bitcoin collateral is released back to the borrower.

Loans backed by Bitcoin  are not designed for leverage or speculation. Using borrowed funds to increase Bitcoin exposure introduces compounding risk and undermines the purpose of the loan. These loans function best as liquidity tools for expenses, investments, or cash flow management unrelated to Bitcoin price speculation.

Debifi operates a peer-to-peer Bitcoin lending model with an emphasis on transparency and defined rules. Loans are structured conservatively, with clear LTV requirements, collateral terms, and communication around risk thresholds.

Automation can reduce friction, but it can also amplify risk during volatile market conditions. For this reason, Debifi emphasizes manual oversight and clear borrower communication rather than instant, automated liquidation systems.

Borrowers considering loans backed by Bitcoin  must assess their own risk tolerance honestly. Conservative LTVs, sufficient collateral buffers, and a realistic repayment plan are not optional - they are prerequisites.

Bitcoin-backed lending does not eliminate risk. It reallocates it. Instead of market timing risk associated with selling Bitcoin, borrowers take on collateral management risk. Understanding this trade-off is essential.

Used responsibly, Bitcoin collateralized loans  can be a powerful financial tool. Used carelessly, they can amplify downside exposure. Education and discipline determine the outcome.


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How Do Bitcoin-Backed Loans Work: Collateral, LTV, and Risk Explained

In January 2026, the Bitcoin market indicators and Debifi lending metrics reflected the following developments:

As of January 31, 2026, Bitcoin was priced at USD 78,689. During the month, the price fluctuated between a high of USD 77,250 and a low of USD 60,820. The maximum drawdown reached –21.3%. Average daily trading volume ranged between USD 35 and 45 billion, while 30-day Bitcoin volatility stood at approximately 2.15%.

Regarding Debifi’s lending metrics, the average loan-to-value (LTV) ratio was 60%, with an overall LTV range of 50% to 70%. The annual percentage rate (APR) varied between 8.5% and 20%. The average loan size amounted to USD 60,000, and loan durations ranged from 1 to 24 months.

Sources : Debifi open loan offers, Tradingview & BitBo

# January 2026 Overview

January was a month of **recalibration** and stress-testing, both for the global macroeconomic landscape and the Bitcoin-backed lending ecosystem.

Following a period of stability in December, the market entered a sharp corrective phase in late January. This Bitcoin downturn saw volatility double compared to the previous month's average, yet market liquidity remained remarkably robust. This price action was largely driven by a high correlation with the global market; as equity markets faltered, institutional algorithms triggered mechanical sell orders to mitigate Value at Risk (VaR). This automated liquidation by institutional funds occurred independently of Bitcoin’s strong underlying fundamentals.

This dynamic didn’t influence Debifi’s lending activity. Despite elevated market volatility and a sharp drawdown, **the platform continues to see new contracts being confirmed**, increased interest from institutional Lenders and Borrowers, and loans remained conservatively collateralized with stable loan-to-value ratios (average of 60%). This outcome highlights Bitcoin’s unique capacity to absorb price shocks while remaining usable as reliable collateral, as well as the effectiveness of Debifi’s disciplined four steps margin call framework.

As the Loan-to-Value (LTV) ratio approaches the threshold of 75%, the platform automatically triggers notifications via the mobile app and email, advising the borrower to either [top up their collateral or partially repay the loan](/blog/en/smart-loan-management). This proactive approach is essential as it empowers users to manage their risk in real-time, preventing unexpected liquidations during periods of high volatility.

Despite the month’s volatility, January’s conclusion remains positive. Bitcoin’s ability to function as robust collateral under pressure confirms the strength of this asset class. At Debifi, we are entering 2026 with a clear focus: scaling our platform while upholding the highest standards of transparency. Through our MultiSig architecture and sound risk management, we continue to offer a sanctuary for those seeking to leverage their Bitcoin without compromising on security.


Debifi monthly newsletter for January 2026

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Debifi & Bitcoin Snapshot for January 2026

For many Bitcoin holders, the need for liquidity does not come from speculation or lifestyle inflation. It comes from practical realities: taxes, business expenses, investment opportunities, or temporary cash flow gaps. When this moment arrives, the most common reaction is also the simplest one - sell Bitcoin.

Selling Bitcoin feels intuitive. It converts a digital asset into spendable currency quickly and with minimal friction. But what feels simple in the short term often turns out to be expensive in the long term.

The first cost of selling Bitcoin is taxation. In most jurisdictions, selling Bitcoin triggers a taxable event. Capital gains taxes reduce the net amount of liquidity received and permanently lower the Bitcoin position. Even in regions with favorable tax treatment, selling creates reporting obligations and strategic complexity that many holders underestimate.

The second cost is opportunity cost. Bitcoin is a scarce asset with a fixed supply and no dilution mechanism. Selling Bitcoin removes exposure to its future upside. This is not a theoretical concern. Many long-term holders have experienced the regret of selling Bitcoin to solve a short-term problem, only to watch its value increase significantly later. Rebuying Bitcoin often happens at higher prices, turning a temporary liquidity need into a permanent loss of Bitcoin ownership.

The third cost is irreversibility. Liquidity needs are usually temporary. Selling Bitcoin is permanent. Once Bitcoin is sold, the position is gone. The decision cannot be undone without re-entering the market under new conditions.

These three factors - taxation, opportunity cost, and irreversibility - make selling Bitcoin a structurally inefficient solution for many liquidity needs.

This does not mean selling Bitcoin is always wrong. There are scenarios where reducing exposure is intentional and appropriate. However, selling should be a deliberate portfolio decision, not a default response to short-term liquidity pressure.

An alternative approach is to borrow against Bitcoin.

Bitcoin-backed loans allow holders to use Bitcoin as collateral to access liquidity while maintaining ownership and economic exposure. Instead of selling the asset, Bitcoin is temporarily pledged under clearly defined terms. Once the loan is repaid, the Bitcoin is released back to the borrower.

This structure aligns better with the long-term conviction many Bitcoin holders have. It recognizes that liquidity needs often exist alongside a desire to maintain Bitcoin exposure.
However, there are risks of borrowing against Bitcoin. . Bitcoin’s volatility introduces collateral risk. Poorly structured loans, excessive leverage, or a lack of risk management can lead to margin calls or [liquidation](https://debifi.com/blog/en/forced-liquidation).

For this reason, Bitcoin-backed lending should not be viewed as a shortcut or a speculative tool. It is a financial instrument that requires discipline, conservative assumptions, and a clear repayment strategy.

At Debifi, Bitcoin-backed lending is positioned as a pragmatic liquidity solution for responsible Bitcoin holders. The goal is not to maximize leverage or chase yield, but to provide structured access to liquidity without forcing unnecessary Bitcoin sales.
Selling Bitcoin may solve a problem today. Loans against Bitcoin, when used conservatively, can solve the same problem without permanently reducing long-term exposure. Understanding this distinction is the first step toward more efficient financial decisions with Bitcoin.


Loans against Bitcoin as alternative to selling BTC

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Why Selling Bitcoin Is Often the Worst Way to Access Liquidity

In 2025 we moved beyond initial tests, released new products, met the Bitcoin community around the world, and continued building tools that let people use Bitcoin without selling it. Below, we recap the key moments that defined 2025 for Debifi and the broader Bitcoin ecosystem.

2025 was an important milestone for Debifi. This year [Debifi exited the beta stage](/blog/en/debifi-exits-beta) and launched officially into full production. Debifi moved from a promising concept to a fully-fledged platform shaping the future of Bitcoin-backed finance.

In 2025, Debifi was recognized by [Zone21.com](https://www.zone21.com/), a crew of Bitcoiners building for other Bitcoiners, as **one of the safest Bitcoin-backed lending platforms in the world**, **ranking second** for security, transparency, and protection of user funds. This confirms that Debifi’s non-custodial, multisig escrow approach keeps Bitcoin safe and fully under user control.

## New partnerships

We are glad to mention the strategic partnership with [Berglinde](https://cryptodaily.co.uk/2025/01/debifi-and-berglinde-join-forces-to-redefine-bitcoin-backed-fiat-lending-with-loans-in-usd-eur-and-chf), a Swiss firm known for combining Bitcoin and traditional finance. Together, we offer fiat loans in USD, EUR, and CHF, opening up more financial options for users who want to access cash without selling their Bitcoin.

Debifi continued improving security for its users. One of those steps is the [partnership with Sygnum to deliver MultiSYG](/blog/en/sygnum-debifi-combine-bitcoin-multi-sig-technology), an innovative Bitcoin-native multi-signature lending solution from a regulated bank, which is expected to launch in early 2026.

## Meeting the Community

This year, Debifi spent more time meeting  partners, borrowers and lenders in person at conferences organized by the Bitcoin community. For us, these events were about conversations, feedback, and learning how Bitcoin is actually being used.

We participated in the following conferences and events:
- Bitcoin Investor Week New York
- Imagine IF Nashville
- Custody and Treasury Summit Nashville
- Plan B El Salvador
- Free Energy Summit Lisbon
- [Plan B Forum Lugano](/blog/en/max-kei-planb-forum-lugano-bitcoin-banking-2025)
- BTC Prague

 Moreover, Debifi was a main [sponsor of the Baltic Honeybadger 2025 edition](/blog/en/debifi-baltic-honeybadger-main-sponsor), showing our support for the part of the community that believes in Bitcoin as sovereign, secure, and non-negotiable.
 
We shared our vision publicly across key global events, contributing to the broader conversation about Bitcoin’s role in finance.

## Product Progress Throughout the Year

This year Debifi has also introduced the [Bitcoin-backed digital cards](/bitcoin-card) that gives users the possibility to get instant liquidity in just a few steps without selling Bitcoin. The card is designed to connect Bitcoin with real-world payments, including [everyday expenses](/blog/en/use-bitcoin-card-in-daily-life) while keeping the same core principles Debifi is built on: security, transparency, and control.

2025 also brought steady improvements and new options on the platform, including:

- [longer-term Bitcoin loans](/blog/en/debifi-24-month-btc-loans) (now up to 24 months!) 
- improved loan management tools
- continued work on usability and transparency

We continuously worked on improving our Debifi app for Android and making it simpler, faster, more convenient, and easier to use.

We also invested heavily in the **Debifi iOS app**. Over the year, it received multiple functional updates and has now become a _fully independent application_, working separately from the website. This means users no longer need a PC or laptop to manage loans — everything can be done directly from an iOS device, anytime and anywhere.

One of the key updates was the [introduction of a **new Dashboard**](/blog/en/dashboard-notifications). It gives lenders a clearer overview of active loans and makes managing their lending easier and more intuitive, all in one place. Borrowers can now clearly see their total borrowed amount, accrued interest, upcoming payments, and the amount of BTC securing each loan. This makes loan management more transparent and helps borrowers stay in control of their positions.

 We also expanded blockchain support. In addition to Tron, Liquid, and Ethereum, Debifi now supports the Solana network — giving users more flexibility when choosing where to operate.
 
In addition to big releases, we spent the year improving Debifi step by step. Over the course of the year, we introduced and improved several key features, including:
- сustom identity verification (KYC) integration
- added support for attachments so borrowers and lenders can upload documents
- unified notifications across web and mobile with push alerts in the app
- reworked Transaction Confirmation UI
- rolled out hardware-only offers
- added TAPSIGNER support on iOS

We have shared more detailed product updates separately, but the goal stayed the same all year: make Bitcoin-backed lending easier to understand and easier to use.

By the end of 2025, Debifi had grown into a stable platform with real users, real volume, and real products.

The focus going forward stays simple: help people **use Bitcoin without selling it**.

Thanks to everyone who used Debifi, gave feedback, or met us in person this year. We’re building this together — step by step.


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Debifi in 2025: A year of growth

Bitcoin is more than just a digital asset — for many, it’s a long-term investment. But what if you need money right now? For a trip, a new laptop because your old one died, the newly launched iPhone or everyday expenses? Going to a bank is painful and long waiting process. Borrow from other people could lead to complicated situations at some point. Selling BTC is not always the best choice, especially when the market may be on the rise.

That’s where the [Bitcoin Card](/bitcoin-card) powered by Debifi comes in. It’s a **digital prepaid Visa card** backed by your Bitcoin as collateral. You don’t sell your BTC — you simply use its value to unlock a spending limit.

Let’s see real-life examples of how the card works and how it helps you stay invested while still covering your needs.

## Book your flights and hotels without selling BTC

You’ve found great flight deals or the perfect hotel — but the crypto market looks promising: Selling Bitcoin right now feels like missing out.

With the Bitcoin backed digital prepaid Visa card, you can avoid it. It lets you keep your Bitcoin and still book your trip. Here is how it works:

1. Use your BTC as collateral to receive a spending limit on the card.
2. Pay for flights, hotels, rentals, or tours directly with the card.
3. Repay the balance later when it’s convenient for you.

Your Bitcoin stays under your control, while sticking to your travel plans. You decide when and where to go without selling your crypto.

## Buy tech today and keep your BTC for the future
Need a new laptop, smartphone, monitor, or home office setup?
Large purchases often come at the wrong time — especially when BTC might go up. And you don’t want to miss the next potential move upward.

Debifi offers an easy possibility to buy the things at the moment you need.

The digital prepaid visa card powered by Debifi makes this simple: You just use your BTC as collateral and get an instant spending limit on the card for any tech purchase you want. You pay in-store or online with the card. All this time your Bitcoin stays safely locked in a non-custodial, 2-of-3-multisig escrow — you keep ownership, and Debifi provides the spending limit.

You get the tech you need now without touching your investment.
Moreover, you can repay your loan whenever you want without any fines.

## Spend every day with no need to cash out
Life is full of small but constant expenses: groceries, gas, subscriptions, online shopping, household items, medicines.

You _could_ convert some Bitcoin every time you need cash — but that means selling your assets piece by piece and losing future potential gains.

The [Bitcoin card](/bitcoin-card) is a digital prepaid Visa card. You can add it to your “digital” wallet on the phone and use it to pay for your daily expenses anywhere Visa is accepted.
The card works perfectly for daily use, so you can:
- Pay in grocery stores and retail shops
- Grab coffee on the go
- Easily pay in cafes and restaurants
- Pay for monthly subscriptions (like Netflix, Spotify, etc.)
- Order from Amazon
- Pay for the gym membership etc.

There’s no need to sell or convert your BTC.
 Just use your card like any other payment card — but backed by your BTC.

<hr>

**The most important thing about the digital prepaid Visa card is that you don’t need to sell Bitcoin when you can use it as collateral.**

This is the main advantage of using a digital prepaid Visa card by Debifi: You keep ownership of your Bitcoin. You simply use its value to cover your everyday expenses.

Debifi’s non-custodial, multisig-secured model keeps your BTC under your control while giving you instant access to funds. Check the details here: [Card offers](/offers?payment_method=product)

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How to use the Bitcoin card by Debifi in daily life

To ensure your Bitcoin-backed loan stays secure and you avoid the process of forced liquidation, it’s important to understand what does forced liquidation mean, how does liquidation work and to know the steps you can take to prevent it. Here's what you need to know about forced liquidation and how to protect yourself.

## What is forced liquidation?

Forced liquidation happens when your **LTV ratio** (Loan-to-Value ratio) **rises above 90%** and you don’t take action to fix it. This usually occurs when Bitcoin’s price drops, your collateral loses value, and your loan becomes too risky. The Borrower should either increase the amount of collateral or partially repay the debt to keep the LTV ratio at an appropriate level, between 30 and 70%.

Before a forced liquidation starts, the Borrower will get **three margin call notifications**. What is a margin call? A margin call means a note of warning that your collateral value has fallen below the required level according to your contract.

If you don’t respond and your LTV goes higher than 90%, Debifi notifies both the Borrower and the Lender as well as the Authorized Key Holder that the forced liquidation process has started. You can’t take any actions if the forced liquidation process has started.

The contract is then closed, and the collateral is transferred to the Lender.
 
Forced liquidation can also occur **if the Borrower doesn’t repay the loan**. After the contract ends, the Borrower has 24 hours to repay the debt. If they don’t do it, forced liquidation begins and the collateral will be liquidated in favor of the Lender.
The collateral will be liquidated based on the exchange rate of bitcoin to USD at the time of liquidation.
 
## Important things to know about forced liquidation

_**For Lenders:**_

·        Even in forced liquidation, your interest is safe. There is no risk of losing your interest — all loans on Debifi are over-collateralized.

·        After liquidation of the contract, you receive the loan amount + interest in bitcoin. Since it is a volatile asset, lenders choose to monitor bitcoin price closely and hedge their risks by converting the bitcoin into fiat or stablecoins in a timely manner.
 
_**For Borrowers:**_

·        Be aware that forced liquidation includes a 5% liquidation fee. It is calculated from the outstanding debt at the time of liquidation (remaining loan amount + accrued interest).

·        If the collateral amount in the multisig escrow exceeds your outstanding debt, the difference is refunded to you.
 
<h2>How to avoid forced liquidation – our tips</h2>

**1. Choose a low LTV ratio**

Your LTV ratio shows how your loan compares to your collateral value. If BTC price drops then your LTV rises and therefore you may need to add collateral.

At the moment of signing the contract take into consideration:

Higher LTV = higher risk of contract liquidation.

Lower LTV = more protection but also more collateral.
 
**2. Add extra BTC to escrow**

Even if your loan starts at, say, 70% LTV, you can always deposit more collateral to protect yourself.

Adding more BTC to the multisig escrow gives you more time to react if the Bitcoin price goes down.
 
**3. Monitor the Bitcoin price**

If Bitcoin starts falling, log in to the Debifi account and check the current LTV of your contract.

A quick adjustment can fully prevent liquidation.
 
**4. Use a valid email address**

Debifi sends all notifications, including margin calls, to your email.

Make sure you have access to it. Always use a valid email to create an account on Debifi.
 
**5. Repay the debt on time (or earlier)**

Don’t wait until the last minute. You can close your loan early anytime without extra fees.
 
**6. Act immediately when you receive a margin call**

A Margin call means that your LTV ratio is too high.

Fix it by:

·        adding more collateral

·        partially repaying your loan.

Forced Liquidation is easy to avoid when you stay ahead of your LTV ratio.

Monitor your loan, react to notifications, and let your BTC keep working for you — without selling it.



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How to avoid Forced Liquidation

- First bank globally to seamlessly combine Bitcoin-native multi-signature wallets with bank-grade lending services  
- Partnership with Debifi addresses growing institutional demand for self-sovereign Bitcoin lending solutions as traditional finance’s embrace of Bitcoin collateral accelerates  
- New product is latest Bitcoin@Sygnum initiative to advance regulated Bitcoin products, technology integrations and research  
- Announcement made on the first anniversary of Sygnum opening its Lugano office, and on first day of Switzerland’s premier Bitcoin event, the Plan B Forum  

---

Zurich, 24 October, 8:00 AM CET — **[Sygnum](https://www.sygnum.com)**, a global digital asset banking group, announces its partnership with **Debifi**, a Bitcoin-backed non-custodial lending platform, to develop **MultiSYG**, an innovative Bitcoin-native multi-signature lending solution. The product, set to launch in H1 2026, is the first multi-signature Bitcoin lending solution from a regulated bank. MultiSYG empowers borrowers to maintain shared control of their collateral through distributed key management rather than via a single custodian. At the same time, they also benefit from the competitive rates, flexible drawdown schedule, loan durations – and white-glove service – of a regulated bank.  

MultiSYG enables Sygnum clients to draw fiat loans against their Bitcoin collateral held in a 3-out-of-5 multi-signature escrow wallet. Distributed control requires multiple private keys to authorise transactions, enabling Bitcoin holders to maintain visibility of their collateral on-chain. This is in line with the fundamental principle of "not your keys, not your coins" that resonates strongly within the Bitcoin community.  

> "A Bitcoin loan should not require blind trust in a custodian," says **Max Kei**, CEO and Founder of Debifi. "MultiSYG's 3-out-of-5 key structure means borrowers can verify their collateral on-chain, while continuing to benefit from Sygnum’s banking relationship and service. After facilitating millions in non-custodial loans, we know this is what the market has been waiting for."  

> “With MultiSYG, we are bringing Bitcoin-native technology to regulated bank lending" says **Pascal Eberle**, Bitcoin@Sygnum and MultiSYG initiative lead at Sygnum Bank. "Borrowers can benefit from bank-grade terms in pricing, drawdown flexibility, and loan duration, while keeping cryptographic proof of their holdings and partial control of their Bitcoin via multi-signature technology. MultiSYG combines the best of both worlds—the ability to hold your own keys while accessing regulated banking products and white-glove service.”  

While other banks require full custody for Bitcoin-backed loans, MultiSYG's distributed key management means clients retain verifiable control of their collateral throughout the loan term – a growing demand from Bitcoin investors. MultiSYG provides a cryptographic guarantee that assets are not rehypothecated, a practice common at traditional banks and other lending services providers.  

This positions Sygnum as the only regulated bank globally offering Bitcoin lending that aligns with the self-sovereignty principles driving institutional Bitcoin adoption. This is a critical differentiator as more companies add Bitcoin to their balance sheets. MultiSYG will complement Sygnum's existing Credit & Lending portfolio and will be available to all Sygnum Bank customers, irrespective of the client’s jurisdiction, upon launch in H1 2026.  

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### About Sygnum  
Sygnum is a global digital asset banking group, founded on Swiss and Singapore heritage. We empower professional and institutional investors, banks, corporates and DLT foundations to invest in digital assets with complete trust. Our team enables this through our institutional-grade security, expert personal service and portfolio of regulated digital asset banking, asset management, tokenization and B2B services.  

In Switzerland, Sygnum holds a banking license and has CMS and Major Payment Institution licences in Singapore. The group is also regulated in the established global financial hubs of Abu Dhabi, Luxembourg and is registered in Liechtenstein.  

We believe that the future has heritage. Our crypto-native team of banking, investment and digital asset technology professionals are building a trusted gateway between the traditional and digital asset economies that we call Future Finance. To learn more about how Sygnum’s mission and values are shaping this digital asset ecosystem, please visit [sygnum.com](https://sygnum.com) and follow us on LinkedIn and X.  

**Media contact**  
Dominic Castley, Chief Marketing Officer  
dominic.castley@sygnum.com  

Sygnum Bank AG  
Uetlibergstrasse 134a  
8045 Zurich, Switzerland  

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### About Debifi  
Debifi is the premier platform for non-custodial Bitcoin-backed lending enabling institutions and individuals to leverage their Bitcoin holdings as collateral while maintaining full control of their keys.  

The platform's multi-signature escrow technology and strict no-rehypothecation policy ensure client assets remain secure and verifiable at all times, with security validated through multiple independent audits.  

Debifi's mission is to accelerate financial freedom through non-custodial, Bitcoin-backed lending solutions that provide institutional-grade liquidity, positioning Bitcoin as the premier collateral asset in global credit markets. For more information, visit [debifi.com](https://debifi.com) and follow us on [X](https://x.com/debificom) and [LinkedIn](https://www.linkedin.com/company/debifi/).  

**Media contact:**  
Sergejs Ponomarjovs, Chief Marketing Officer  
sergejs.ponomarjovs@debifi.com  


Sygnum and Debifi  Combine Bitcoin Multi-Sig   Technology with Regulated  Bank Lending Services 

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Sygnum and Debifi Combine Bitcoin Multi-Sig Technology with Regulated Bank Lending Services

Debifi Blog