Strike is proposing a new kind of loan secured by Bitcoin that aims to eliminate concerns about margin calls and forced liquidations. The company claims borrowers may keep their BTC even if the price falls, provided they stay current on their loan payments. The move targets long-term investors who want cash now but don’t want to sell their Bitcoin in unpredictable markets.
At the Bitcoin 2026 conference, Strike CEO Jack Mallers announced “volatility-proof” Bitcoin-backed loans produced in conjunction with Tether. Customers “can’t get liquidated, no matter what happens to the price of Bitcoin,” as long as they accept a unique structure and fee, he said. The loans were built to solve the problem that users were most worried about: “price wicks down and liquidations more than anything else,” Mallers said.
Under the framework, borrowers pledge BTC as collateral but avoid the usual margin call triggers when prices fall. Instead of auto-selling their Bitcoin, Strike lets them keep the collateral in place while they continue making scheduled payments. The company says the structure can withstand an 80% drop in BTC’s price without liquidating the customer’s holdings, as long as the customer stays current on the loan.
Backing from Tether and Proof of Reserves
Strike set up a $2.1 billion credit arrangement with Tether to fund the lending program. Mallers said Tether also built a “lending proof-of-reserves” system that keeps collateral segregated in on-chain addresses and lets borrowers verify it.
Larger clients with at least 50 BTC can request a dedicated address and watch their collateral live on the blockchain, giving them extra confidence that Strike is not rehypothecating their coins.
Strike publishes proof-of-reserves reports and uses external auditors to confirm that customer collateral exists and remains intact. Its private client desk is launching the loans first, and Mallers said they will reach regular app users “in weeks or months.”
Even with volatility protection, these loans still have clear limits and costs. Strike caps the loan-to-value ratio at 50%, so borrowers can only access up to half the value of their Bitcoin. Interest rates start at around 7.49% APR for larger private-client loans, while retail offerings in most U.S. states and Europe are closer to 8–11% APR, depending on loan size.
Because borrowers never have to sell their BTC, Strike argues they can avoid taxable events and remain fully exposed to any future price recovery.
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