Bitcoin-backed lending is adopting more traditional financial safeguards as banks and institutional investors expand their involvement, according to Silicon Valley Bank. Crypto-backed loan volume reached $67 billion in the first quarter of 2026, up nearly 50% year over year.
Bitcoin-backed lending is adopting more traditional financial safeguards as banks and institutional investors expand their involvement, according to Silicon Valley Bank. Crypto-backed loan volume reached $67 billion in the first quarter of 2026, up nearly 50% year over year.
Loan activity has continued to expand despite weaker crypto-market conditions. Total lending backed by cryptocurrencies reached $67 billion in the first quarter of 2026, nearly 50% higher than a year earlier, according to Galaxy Research data cited by SVB. The bank said conservative loan-to-value ratios have helped keep reported defaults rare and losses limited.
Bitcoin-backed lending is entering a more institutional phase, with established financial firms offering credit against bitcoin products and lenders adopting stronger collateral and transparency standards, according to research from Silicon Valley Bank. The bank said several major U.S. financial institutions had launched bitcoin-backed lending for select clients by the first half of 2026.
The shift matters because it suggests the sector is rebuilding around more familiar credit structures after the 2022 collapses of BlockFi, Celsius and Genesis. Those failures wiped out about $11 billion in customer funds, while newer models generally require borrowers to pledge substantially more bitcoin than the dollars they receive and continuously monitor the collateral.
Loan activity has continued to expand despite weaker crypto-market conditions. Total lending backed by cryptocurrencies reached $67 billion in the first quarter of 2026, nearly 50% higher than a year earlier, according to Galaxy Research data cited by SVB. The bank said conservative loan-to-value ratios have helped keep reported defaults rare and losses limited.
Institutional milestones are also emerging. Ledn completed a $188 million asset-backed security that SVB described as the first bitcoin-collateralized transaction to receive an investment-grade rating from a nationally recognized statistical rating organization. JPMorgan, Wells Fargo, Citi, Charles Schwab and Morgan Stanley are among the firms lending against bitcoin products, primarily through exchange-traded funds.
Borrowing remains relatively expensive, with bitcoin-backed loan rates ranging from 7.5% to 16% APR in the examples reviewed by SVB. The bank expects a broader pool of private-credit and bank capital could eventually narrow credit spreads, while technologies such as the Lightning Network may help automate margin calls, collateral transfers and liquidations. Those developments remain dependent on further lender adoption and continued access to institutional funding.
Keep exploring
Bitget plans to exit the Japanese market and close all remaining positions by the end of the year. The move adds to ongoing shifts among crypto companies navigating Japan’s regulatory environment.
Read
CoinDesk’s State of Crypto coverage counts down recent developments shaping the crypto policy and market landscape. The report frames these changes as important for how companies and participants navigate the sector.
Read
Strategy said it is holding the dividend on its STRC preferred stock at 12%. The decision keeps the payout unchanged for investors in the company’s yield-focused security.
Read