Verified against lava.xyz on 30 July 2026. Rates fix for a year at opening but products change; confirm current terms before borrowing.
How Lava's Bitcoin loan works
Lava, founded in 2022 and backed by a $200M raise, offers a Bitcoin Line of Credit (BLOC) rather than a fixed loan. You lock BTC into a multisig escrow contract you co-control and draw dollars (USD/USDC) as needed. There are no required monthly payments and no fixed maturity — interest accrues, and you pay down or close whenever you like. Fixed-term loans (1–12 months) are also available.
Rates & fees
The line of credit accrues at 7.5% APR under $100k and 6.5% above, fixed for a full year after opening. On top, Lava assesses a 2% capital charge on your maximum annual outstanding balance — so a fully-drawn line's real cost runs roughly 8.5–9.5%. Fixed-term loans range from 5% (1 month) to 11.5% (12 months). No origination or prepayment fees are published.
LTV & liquidation
Each draw originates at 50% LTV or lower, and the line supports up to 60% LTV overall. There's no single posted liquidation LTV: the app shows your live LTV and per-loan liquidation price, sends multiple warnings as you approach it, and offers liquidation protection — automatically moving BTC from your app balance into collateral during extreme volatility. You can also top up or pay down at any time. Model scenarios with the liquidation calculator.
Custody & safety — why we rate Lava Medium relative risk
Lava's multisig model means it never takes unilateral control of your bitcoin and collateral is not rehypothecated — structurally similar to Unchained or Firefish. We still rate it Medium rather than Lower for now: the liquidation trigger is dynamic rather than a published fixed threshold, and the platform is younger than the incumbents with less public documentation of its escrow arrangements. Neither is disqualifying — they're the "variable terms" our methodology flags.
What a $25,000 Lava draw costs
Effective first-year cost ≈ $2,375, or ~9.5% — draws over $100k price at 6.5% for ~8.5% effective. Figures are illustrative.
Pros & cons
Strengths
- Self-custodial multisig — no rehypothecation
- 6.5–7.5% APR undercuts most CeFi lenders
- No monthly payments, no fixed maturity
- Rate fixed for a year after opening
- Automatic liquidation-protection top-up option
- US-focused with strong funding ($200M raise)
Trade-offs
- 2% annual capital charge pushes real cost to ~8.5–9.5%
- No published fixed liquidation LTV — must monitor the app
- Younger platform with a shorter track record
- US-focused — limited availability elsewhere
- Line-of-credit structure can encourage over-borrowing
Who Lava is best for
Lava suits US borrowers who want self-custody and flexibility — draw, repay, and redraw without fixed terms or monthly payments. If you're in Europe or want the lowest marketplace entry rate, see Firefish; for $20K+ institutional loans, see Debifi; for a US custodial alternative, compare Strike.
FAQ
What are Lava's Bitcoin loan interest rates?
7.5% APR on line-of-credit balances under $100k, 6.5% above — fixed for a year — plus a 2% capital charge on your maximum annual outstanding balance. Fixed-term loans run 5–11.5% APR.
Who holds my Bitcoin at Lava?
A multisig escrow you co-control. Lava cannot unilaterally move your collateral, and it is not rehypothecated.
When does Lava liquidate collateral?
There's no fixed liquidation LTV — the app shows a per-loan liquidation price, sends repeated warnings, and can auto-top-up collateral if you enable liquidation protection.
Does Lava require monthly payments?
No — no required payments and no maturity date on the line of credit; pay down or close anytime.
See Lava next to every other lender
Live rates, LTV, liquidation thresholds, custody, and minimums for every lender we track in one verified table.
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