Borrow Against Bitcoin Without Selling

Access Cash. Keep Your Bitcoin.

Selling Bitcoin to access cash is a taxable event that removes you from future upside. If you've held Bitcoin for years and it's appreciated significantly, selling means paying capital gains tax on the entire gain — potentially 20%+ of your position.

Borrowing against Bitcoin lets you access the liquidity you need while maintaining your long-term position. No taxable event. No lost upside. Your Bitcoin stays yours.

How Bitcoin-Backed Loans Work at Onramp

1. Deposit Bitcoin as collateral into your Onramp custody account
2. Receive a cash loan based on the value of your collateral
3. Your Bitcoin stays in Multi-Institution Custody — never moved to a single custodian, never rehypothecated, never lent out
4. Repay on your terms and receive your full Bitcoin collateral back

The Rehypothecation Problem

When BlockFi, Celsius, and Genesis offered Bitcoin-backed loans, they rehypothecated client collateral — lending it out to generate additional yield. When the market crashed, they couldn't return collateral because it had been lost in leveraged trading positions.

Onramp never rehypothecates your Bitcoin. Your collateral remains in Multi-Institution Custody across three independent custodians for the entire duration of your loan. This is the fundamental architectural difference.

As the saying goes: not your keys, not your coins. With Onramp's MIC, your collateral is distributed across three custodians — no single institution has the ability to move, lend, or lose your Bitcoin.

Why Borrow Instead of Sell?

Action | Tax Impact | Bitcoin Exposure | Upside Potential

**Sell Bitcoin** | Capital gains tax (up to 20%+) | Lost | None

**Borrow against Bitcoin** | No taxable event | Maintained | Full

Example

You hold 2 BTC purchased at $10,000 each. Bitcoin is now at $100,000. You need $50,000 in cash.

If you sell: You sell 0.5 BTC for $50,000, triggering a $45,000 capital gain. At 20% long-term capital gains tax, you owe $9,000. Net cash: $41,000. And you've permanently reduced your Bitcoin position.

If you borrow: You post 1 BTC as collateral and borrow $50,000. Zero tax impact. You receive the full $50,000. When you repay, your 1 BTC is returned. If Bitcoin doubled during your loan term, your collateral is now worth $200,000.

Loan Terms

• Competitive interest rates based on LTV and loan size
• Flexible repayment — no prepayment penalties
• Transparent terms — no hidden fees, no origination fees
• Multi-Institution Custody on collateral throughout loan term
• No rehypothecation — your Bitcoin is never lent out

Use Cases

• Real estate down payment without selling your Bitcoin position
• Business investment — access capital for opportunities without liquidating
• Tax planning — access liquidity in high-income years without adding capital gains
• Bridge financing — short-term cash needs without long-term position disruption
• Diversification — deploy cash into other assets without selling Bitcoin

Part of the Complete Onramp Platform

Bitcoin-backed lending integrates with your full Onramp account:

• Custody — collateral protected by the same MIC securing $1B+
• Earn — your cash balance earns 5% while you manage your loan
• Card — continue stacking 1.5% Bitcoin rewards while borrowing
• IRA — tax-advantaged Bitcoin alongside your liquid position

Getting Started

1. Open your Onramp account
2. Deposit Bitcoin collateral
3. Select your loan amount and terms
4. Receive cash — your Bitcoin stays secured by MIC

Frequently Asked Questions

How do Bitcoin-backed loans work at Onramp?

You deposit Bitcoin as collateral and receive a cash loan. Your Bitcoin stays in Onramp's Multi-Institution Custody — never rehypothecated or lent out. When you repay the loan, your full Bitcoin collateral is returned. No taxable event is triggered.

Does Onramp rehypothecate my Bitcoin collateral?

No. Onramp never rehypothecates client Bitcoin. Your collateral remains in Multi-Institution Custody across BitGo, Coinbase, and Anchor Watch for the duration of the loan. This is a fundamental difference from lenders like BlockFi that rehypothecated client assets.

Why borrow against Bitcoin instead of selling?

Selling Bitcoin triggers capital gains tax and removes you from future upside. Borrowing against Bitcoin lets you access cash while maintaining your position. If Bitcoin appreciates during your loan term, you benefit fully when your collateral is returned.

What is the interest rate on Onramp Bitcoin loans?

Onramp offers competitive interest rates based on loan-to-value ratio and loan size. There are no origination fees, no hidden charges, and no prepayment penalties. Contact Onramp for current rates.

Is borrowing against Bitcoin a taxable event?

No. Borrowing against Bitcoin is generally not a taxable event in the US because you are not disposing of the asset. You maintain ownership of your Bitcoin throughout the loan. Consult your tax advisor for your specific situation.