Crypto.com Lending: A Complete Guide to Crypto Borrowing

Ever wondered if you could use your crypto assets without selling them? Well, that's what Crypto.com Lending offers. The service allows you to borrow cryptocurrency by using your existing holdings as collateral, meaning that you won’t have to sell your assets to get the funds you need.

With the flexibility to use these loans for margin trading or other financial needs, it opens up a world of possibilities. Plus, knowing that other reputable exchanges like Binance and Bybit offer similar services adds an extra layer of confidence.

Let's dive into how Crypto.com Lending works and see how their services might fit into your crypto strategy!

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What is Crypto.com Lending?

Crypto.com is a prominent cryptocurrency trading platform founded in 2016 by Kris Marszalek, Rafał Mikśa, and Gary Or. It offers a range of financial services designed to leverage blockchain technology.

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Among its services, Crypto.com Lending stands out, allowing users to borrow against their cryptocurrency or earn interest by lending their assets. This way, you can keep your investments while still getting the needed cash.

If we retrace the history, Crypto.com actually started with VISA-powered payment cards.^[1] But now, it has expanded to full-suite financial services. The platform puts a heavy emphasis on user-friendliness, accessible through the Crypto.com App or web.

You may ask, what specific financial services does the application offer? It has quite a few options, including trading, lending, and staking. These features are also seamlessly tied together with CRO^[2], Crypto.com's native token, and other assets.

Now, let's put our focus on borrowing. After all, this process is tied to lending on Crypto.com, and thankfully, the steps are straightforward. You choose how much you want to borrow and which crypto assets you'll use as collateral to secure the loan.

Furthermore, through its Crypto Credit service, users can borrow money instantly by using coins like BTC, ETH, and CRO as collateral, with no credit checks required. As a result, you can get immediate access to funds while still keeping your crypto investments safe.

Finally, let's dive deeper into lending. Crypto.com offers competitive rates, making the platform stand out against traditional services. The application clearly explains the interest rates and terms, so there are no surprises.

If you're in the US, you might be wondering, "Is Crypto.com Lending USA available?". No worries, we’ll look into the service's availability in different regions and explore some alternatives if it's inaccessible in your area.

So, if you’re trying to make the most of your crypto without selling, using this platform could be a suitable solution. Let’s dive deeper into how this works and see where it’s available, including the availability of Crypto.com Lending in the USA!

Qualifications to Meet

Crypto.com Lending eligibility depends on your location, and the platform’s Know-Your-Customer (KYC) verification is a crucial first step for security and regulatory compliance.

Once you confirm your country is not on the restricted list of the application, you can complete the KYC by providing personal details and verifying your identity with documents like a passport or driver's license. While this may seem inconvenient, it's essential for account safety.

After verification, you can deposit crypto assets as collateral and take advantage of competitive lending rates, allowing you to borrow without selling your holdings. Users must be at least 18 years old and agree to Crypto.com’s terms and conditions for a smooth experience.

Location-Specific Eligibility

While the general Crypto.com platform is available in 49 US states, including California, Colorado, Pennsylvania, Washington, and Alaska, its lending services are still restricted in the said country. So, if you're asking, is Crypto.com Lending USA available? Not yet, unfortunately.

Internationally, Crypto.com Lending services are also off-limits in Canada, Australia, Hong Kong, Germany, France, and the UK.

Here's a quick snapshot of the jurisdictions where lending on Crypto.com is not allowed, aside from the other regions I've mentioned:

• Brazil
• Denmark
• France
• Germany
• Ireland
• Italy
• Monaco
• Netherlands
• China
• South Africa

Due to these geographic limitations, it’s essential to confirm whether lending on Crypto.com is available in your country before proceeding. If not, usually, Crypto.com will show a warning at the top of the page, or you won't be able to pass through the lending service.

Now that you know that Crypto.com is unavailable in several countries, you may be wondering about alternatives. If you're outside of the US, check out the crypto loans offered by Bybit or Binance.

	BYBIT	BINANCE
Overall Score	9.8	9.6
Best For	More Advanced Users	Buying, Trading, and Holding a Wide Variety of Cryptocurrencies
Operating Countries	Russia, South Korea, United Kingdom, Ukraine, Turkey, +150 more	Turkey, Russia, Argentina, Vietnam, Ukraine, + 40 more
Latest Coupons	CLAIM $30,000 All Bybit Coupons	REDEEM $600 BONUS All Binance Coupons
Verdict	A popular crypto derivatives exchange with some super-low trading fees.	One of the leading crypto exchange platforms in the industry.
	Visit site Read review	Visit site Read review

Table: Bybit VS Binance comparison.

Both platforms allow you to borrow and trade assets for spot, margin, or futures trading. You can also earn some sweet Annual Percentage Yield (APY) along the way, depending on the token or coin you loan. Just make sure to understand the T&Cs completely before signing up.

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Supported Crypto Assets

By now, you know the countries that geographically lock Crypto.com, including the USA. But, if you've discovered that your country is safe from the list, you may be wondering how to start lending on Crypto.com.

Let's start with the basics, such as the crypto assets you can use as a loan. Thankfully, Crypto.com Lending provides quite a selection of cryptocurrencies, including the top picks. As a lender, you're given the flexibility to leverage those assets without actually selling them.

So, let's see what assets you can actually use as collateral or those available to borrow.

Accepted Collateral Assets

Crypto.com Lending offers several options for depositing collateral. You can use both well-known cryptocurrencies or altcoins. That said, here are some of the assets you can use as collateral:

• BTC
• ETH
• LTC
• LINK
• XRP
• USDT
• ALGO

In addition, the list is constantly growing as Crypto.com Lending continues to add more crypto assets to the platform. Therefore, if you didn't find the coin you were looking for, it's always a good idea to check for updates since it can be added at any moment.

It's important to note, however, that the platform does not currently support mixed collateral deposits for a single loan. In other words, you can only use one type of crypto asset simultaneously. But you're free to take out multiple loans, with each of them getting backed by a different asset.

This flexibility is one of the key advantages of lending on Crypto.com, enabling you to tailor your strategy depending on the cryptocurrencies you hold and your financial goals.

Borrowing Crypto Assets

I've shown you the full list of cryptocurrencies you can use as collateral, but what about the ones to borrow? You can breathe a sigh of relief, as the list is also just as extensive.

Whether you're looking to borrow stablecoins like USDC to manage volatility or prefer the classics like BTC or ETH, Crypto.com gives you multiple options based on your financial needs.

Here are some of the available crypto assets available as loans:

• USDC
• BTC
• ETH
• XRP
• LINK
• DOGE
• UNI
• SHIB

Once you've selected your collateral, the platform calculates the loan amount you can borrow based on the value of your chosen asset and the current lending rates. This ensures that you're borrowing within your means and maintaining a healthy loan-to-value (LTV) ratio.

For example, if you hold a BTC and want to maintain your position while accessing liquidity, you can use those coins to borrow USDC or another cryptocurrency.

Loan Limits and Terms

When using Crypto.com Lending, it's important to understand the loan limits and terms. This helps you figure out how much you can borrow and what you’ll need to repay.

For starters, the minimum amount is 100 USD. This applies to many popular crypto assets like USDC, USDT, BTC, ETH, and more.

So, if you want to borrow stablecoins or other cryptocurrencies, the minimum amount is always 100 USD. By default, Crypto.com pegs USD to USDT at a 1:1 rate, meaning the value is consistent and stable.

By keeping the minimum loan small, Crypto.com Lending allows users to borrow only what they need. This is helpful if you’re not looking to take out a large loan but need a bit of extra funds. It also makes it easier to understand how much you borrow and repay. Plus, you'll get extra flexibility, depending on the asset you choose.

Now, when borrowing larger amounts on Crypto.com Lending, there is a maximum limit to keep in mind. Retail users can borrow up to $5 million per loan, offering versatility for bigger needs.

The same amount limit also applies to institutions. Just like smaller loans, the value is tied to USDT, meaning it can change based on market movements.

Crypto.com Lending offers flexible terms with hourly interest rates. This allows users to pay only for the time they use the money. This setup is beneficial for those needing short-term loans, as borrowers are only charged interest for hours or days rather than committing to fixed periods.

The hourly calculation also applies to longer-term deals, giving users control over their interest charges and the flexibility to manage costs according to their needs. Overall, Crypto.com is highly transparent about its loan limits and terms, which makes it easier to plan your borrowing and helps you make better financial decisions.

Understanding Loan Health

When you're borrowing a loan, keeping track of its health should be a priority. Loan health generally refers to the risk level of your deposited collateral and, of course, the loan balance itself.

Crypto.com showcases a health indicator that transitions from green (healthy) to red (not healthy). If you monitor it and see that the bar is nearing the red mark, it's best to make repayments as soon as possible.

The platform has a couple of thresholds to determine a loan's LTV, which can be understood as below:

Table: loan health thresholds on Crypto.com Lending.

Take note: the Margin Call LTV on Crypto.com is around 70%, whereas the Forced Liquidation LTV is 80%. So, be cautious.

If your loan has hit the Margin Call, Crypto.com will promptly send you an email notification daily until you pay it down. In addition, remember that you can also make partial payments.

To improve your LTV, the only way around it is to repay your loans until your LTV has reached a healthy level. As of now, additional collateral deposits are not supported on Crypto.com due to the inherent risks.

Lending Rates and Interest

If you're new to Crypto.com Lending, understanding how the interest rates work is important. Luckily, it’s not as complicated as it might sound.

The interest you pay on your loan depends on the LTV ratio. It tells you how much your borrowed money is worth compared to the value of the crypto you're using as collateral. Think of it like this: if you're borrowing $100 and you have $400 worth of Bitcoin as collateral, your LTV is 25%. The lower it is, the better interest rates you'll get.

For example, at a 25% LTV, your interest rate would be 2.00% APR. But if you lock up 100,000 CRO tokens or more, you can lower that rate to 1.00% APR.

This can save you money, especially if you're planning to keep the borrowed finances for a while. At higher LTVs, like 33% or 50%, the interest rates go up to 6.00% APR or 8.00% APR, but locking CRO still reduces those rates by 2%.

Now, how is the interest rate calculated on Crypto.com? Instead of charging you monthly or annually like most loans, Crypto.com Lending calculates interest hourly.

You you take care of the debt early, you'll only pay for the exact hours you borrowed the money. Essentially, if you only need the loan for a few days, you're not stuck taking care of extra interest.

Mind that Crypto.com applies simple interest. As such, the additional payment is only calculated on the original amount you borrow and it doesn't keep adding up on top of itself over time. For instance, if you borrow $100, you'll pay interest on that $100 and not on the extra that builds up later.

In short, by keeping your LTV low and locking up some CRO tokens, you can borrow at a lower rate. Plus, with hourly interest calculations and simple interest, you have the flexibility to manage your loan on your terms without getting overwhelmed by extra charges. Plus, because the platform uses the simple interest type and calculates it hourly, you have the flexibility to manage your loan. 

Next, let’s dive into how you can borrow loans with Crypto.com Lending and use these benefits to your advantage.

How to Borrow Loans?

Ready to start lending? Borrowing a loan on Crypto.com is a simple and straightforward process.

Whether you're using your crypto for a short-term need or planning a longer-term investment, as mentioned previously, the platform gives you the flexibility to borrow against your assets without having to sell them. Let's walk through the steps to borrow a loan and manage it.

Step 1: Sign up or log in to your Crypto.com exchange account, which is where all the lending functions are managed.

Step 2: Navigate to the dashboard. This is where you can find and manage all your transactions, including loans. Click on the “Lending” section, then tap “Loans”. Once you’re there, you will find the option to borrow loans and view or manage your current ones.

Step 3: To borrow, click “Take Out a New Loan”. By doing so, you can choose your collateral and decide which crypto asset you want to borrow, such as USDC, BTC, or ETH. Keep in mind that the Crypto.com lending rates depend on your LTV ratio and whether you lock up CRO tokens.

Step 4: After selecting the amount you want to borrow, review the loan details carefully. Make sure to check the interest rate, repayment terms, and how much collateral is being locked. Once you’re satisfied, confirm the loan.

When approved, the borrowed crypto will appear in your Crypto.com Exchange Wallet, where you can use or withdraw it.

What If I Borrow Multiple Loans?

Speaking of multiple loans, Crypto.com allows you to have up to three active ones at the same time. However, there are some conditions. You won’t be able to borrow additional loans if you’re in Forced Liquidation from a margin loan or if you don’t have enough collateral to secure a new one. So, keeping an eye on your overall financial status is crucial to ensuring a smooth process.

As established, once you’ve borrowed crypto through Crypto.com Lending, you can withdraw it either to the Crypto.com App, Crypto.com Exchange Wallet, or any whitelisted address. This flexibility means you can use the funds immediately, whether for trading, personal use, or transferring to another wallet.

How to Avoid Forced Liquidation?

Forced liquidation might be a serious problem. Therefore, to avoid it, it's important to manage your loan smartly. Naturally, it's highly recommended to ensure timely repayments or maintain a healthy LTV ratio by making partial payments gradually.

If you're looking for a more practical tutorial, follow these steps to manage your loan on Crypto.com:

Step 1: Once you're logged in, in the dashboard, head to "Lending" > "Loans".

Step 2: Select "Repay Now" to settle your outstanding loan balance.

While I've given a tip on preventive action, let's see what contingency plan is available if such an unfortunate scenario happens on Crypto.com.

As a primer, the platform will charge you liquidation fees of 0.5% (as a taker rate) for any orders required to liquidate your collateral. Kindly note that some adjustments may alter these fees.

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Pros

• A very well-known crypto exchange platform
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• Over 500 different cryptocurrencies available
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How Does Repayment Work?

Paying back your loan via Crypto.com's borrowing option is easy once you understand the basics. Let's break it down in simple terms so you can mange it without any confusion.

When you repay your loan, you always have to pay back the interest first before you can start reducing the principal (the amount you borrowed). Think of it like paying rent for borrowing the money—the interest is the rent, and the principal is the main amount you're paying off.

Here’s an example: let’s say you borrowed 10,000 USDT, and you’ve accumulated 15.29 USDT in interest. If you decide to pay back just 10 USDT, it will only cover part of the interest, leaving 5.29 USDT. In this case, your 10,000 USDT principal will stay the same.

But if you repay more than the interest owed, the extra amount will start paying down the principal. For example, if you repay 5,000 USDT, the first 15.29 USDT will go toward clearing the interest, and the rest (4,984.71 USDT) will reduce your principal.

Additionally, on Crypto.com Lending, you can repay your loan early without any fees or penalties.

Imagine it like renting a car—you only pay for the hours you use it. If you return it early, you save money. The same applies to your loan—the quicker you pay it off, the less "rent" (interest) you pay.

To calculate the interest, Crypto.com uses this formula:

Hourly Interest = (Outstanding Loan Principal) × (APR ÷ 365 ÷ 24)

For example, if you borrowed 10,000 USDT at an 8% APR, you’ll be charged roughly 0.0913 USDT in interest per hour.

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Conclusion

Crypto.com Lending offers an option to borrow money without having to sell your crypto. As such, you can keep your assets while using them as collateral to get the funds you need quickly and easily.

One of the best parts is that you can lock up CRO tokens to get lower interest rates, saving you money. Plus, the flexibility to pay back the loan anytime helps you stay in control of the total interest you pay.

That said, Crypto.com Lending in the USA and several other countries is non-existent. Admittedly, it is hard to find crypto loan services in a region as strict as the US. If you're elsewhere, though, it might be worth checking out Bybit Lending or the crypto loans from Binance, which you can use for various trading methods—spot, margin, or derivatives.

But, if you're in some parts of Asia and Europe, Crypto.com Lending can be a worthwhile option for those looking to make the most out of their crypto. Instead of selling your crypto abruptly when you need cash, Crypto.com does it differently, allowing you to borrow against crypto and repay when you're ready.

The content published on this website is not aimed to give any kind of financial, investment, trading, or any other form of advice. BitDegree.org does not endorse or suggest you to buy, sell or hold any kind of cryptocurrency. Before making financial investment decisions, do consult your financial advisor.

Scientific References

1. Penelope I.: 'Crypto.com Coin (CRO): Expert Analysis of CRO Market';

2. Kumar N., Raj P., Aggarwal S.: 'The Blockchain Technology for Secure and Smart Applications Across Industry Verticals'.