Custody for loans
Loans for individuals and businesses, backed by crypto
Get liquidity in euros by pledging your crypto held at CheckSig, or grant a loan at a very attractive return to someone who entrusts their crypto to our custody.
The loan is agreed directly between borrower and lender; CheckSig acts as custodian of the crypto posted as collateral, protecting both of them.
Parties involved
In a crypto-backed loan, the contract is entered into between the borrower who receives the liquidity and the lender who provides it; CheckSig does not grant the loan and does not carry out credit mediation.
On the parties’ instruction, the crypto provided by the borrower as loan collateral is held in custody at CheckSig.
CheckSig as custodian
CheckSig is the custodian of the crypto posted as loan collateral, monitors its market value and technically manages the contractual thresholds agreed between borrower and lender. In particular:
- Certifies the initial value of the collateral as equal to or above the collateralization threshold (200% of the loaned capital).
- If the value falls below the alert threshold (e.g., 145% of the loaned capital), with a margin call it notifies the borrower to top up the collateral to avoid its liquidation, and converts the crypto other than Bitcoin into Bitcoin.
- Liquidates the collateral in the cases and terms set out in the contract, including where the value falls to the liquidation threshold (e.g., 120% of the loaned capital).
Borrower
Individual or company
Gets euro liquidity from the lender by posting as collateral crypto held at CheckSig, without having to sell it: this does not, in itself, realize taxable capital gains and the borrower keeps the exposure to its market performance.
As long as the value of the collateral stays above the alert threshold, the borrower can keep operating on the crypto in custody — buy, sell, convert, stake — within the limits compatible with maintaining the collateral. If the collateral exceeds the collateralization threshold, the borrower can even withdraw the excess.
Lender
Individual or company
Provides euro liquidity to the borrower and in return earns a very attractive return against a risk mitigated by the quantity and quality of the collateral.
The initial collateral is at least 200% of the loan (collateralization threshold) and is held in Bitcoin (or converted into Bitcoin at the alert threshold), an asset easy to liquidate if needed, being traded day and night, holidays included.
Clear terms, for both parties
Duration
Agreed between the parties, it is usually one or two years, renewable at maturity.
Amount
Indicatively, the loan starts from 10,000 euros and can exceed 1 million euros.
Collateral (LTV)
The collateralization threshold is 200% of the loaned capital, i.e., a Loan To Value (LTV, the ratio of amount lent to the value of the collateral) of 50%.
Rate
Agreed between the parties, it decreases as the offered collateral grows, for example: 12% gross per year for 200% collateral (LTV 50%), 6% gross per year for 500% collateral (LTV 20%).
Costs
Custody of crypto follows the existing terms. The specific loan-collateral service (monitoring the thresholds, margin call, liquidation) is subject to an additional fee, specified in the contract.
Signing the contract
You will need certified email (PEC) and a qualified electronic signature (QES). If you do not already have them, the CHECKSIG code gives you a 20% discount on PEC LITE (one year) and/or Qualified Cloud Signature (three years).
Interested?
Do you want to get euro liquidity by pledging your crypto held at CheckSig, or grant a loan to someone who has crypto held with us?
CheckSig is not authorized to lend money under the Italian Banking Act (D.Lgs. 385/1993). The loan agreement is reached between the parties within the limits of the law and in compliance with usury thresholds: CheckSig does not act as a facilitator, agent, or credit broker but only as custodian of the crypto-assets posted as collateral, within the limits of the contract between the parties and the applicable operating procedures, limited to the obligations and rights associated with its role.
Percentages, thresholds, durations, amounts, and rates shown on this page are illustrative only and do not constitute a public offer, a promise of return, or a contractual proposal. The values actually applied are contractually agreed by the parties in compliance with the applicable law in force from time to time.
Risk Warning
CheckSig does not assess the borrower’s creditworthiness and does not guarantee the solvency of any party. Crypto-assets carry significant market risks and may lose value, even entirely. When used as collateral for a loan, a reduction in their value may compromise coverage of the credit.
For the borrower, the conversion and/or automatic liquidation of the crypto-assets posted as collateral according to the terms set out in the contract may result in their total or partial loss, is subject to fees and may be a taxable event. If the liquidation proceeds are not sufficient to discharge the debt, the borrower remains liable for the outstanding balance.
For the lender, over-collateralization and automatic liquidation reduce the risk but do not eliminate it: in the event of particularly sudden price drops, the liquidation proceeds may not fully cover the credit.