On September 3, APX Lending, the first regulated lender in Canada to offer loans secured by digital assets, introduced a five-year revolving line of credit. This innovative product enables clients to borrow against Bitcoin, Ethereum, or both, as highlighted in the company’s announcement. Notably, there are no fees for origination, prepayment, or liquidation, and it includes up to $250 million in collateral insurance protection.
Understanding the Line of Credit
In contrast to APX’s fixed-term loans, which are secured by either BTC or ETH, the new offering allows for the use of both cryptocurrencies to determine borrowing limits. For instance, if a client possesses $200,000 in Bitcoin and $100,000 in Ethereum, the total of $300,000 can be used towards a single credit line. With a loan-to-value ratio of 60%, this translates to a borrowing potential of up to $180,000. The annual interest rates are set between 10.49% and 11.99%, based on the balance, and interest is charged only on the amount utilized, meaning borrowers incur no costs on any unused credit.
The revolving nature of the credit line allows clients to access funds, repay them, and access again as their requirements evolve, eliminating the need to initiate a new loan each time. The available credit also fluctuates with the value of the collateral, increasing or decreasing in tandem with the market prices of Bitcoin and Ethereum.
A Framework for Regulated Lending
APX made history as Canada’s first lender backed by digital assets approved by securities regulators, holding registrations with both FINTRAC and FinCEN. Established in 2023 and headquartered in Toronto, the organization now provides fixed-term loans, revolving credit options, and a Lending-as-a-Service model, enabling banks and fintech companies to offer APX-powered services to their customers. “A revolving line of credit is something our clients have requested consistently,” stated founder and CEO Andrei Poliakov. “Whether it’s for a purchase today, an investment in three months, or a business-related expense later in the year, clients should not need to apply for a new loan each time.”
Expanding Options for Crypto-Backed Credit
The introduction of this service reflects a growing landscape for crypto-secured borrowing. A recent forecast from Ledn suggested that the market for Bitcoin-backed loans might reach $1 trillion within the next decade. Additionally, banks have begun to accept digital assets as collateral, with Sberbank intending to offer loans against Bitcoin, Ethereum, and USDT. APX’s initiative indicates that regulated lenders are evolving from one-time loans toward products resembling traditional bank credit lines, even as borrowing capacities remain linked to the fluctuating market values of the cryptocurrencies pledged.