Binance has launched Lite Loan, a simplified Bitcoin-backed borrowing product allowing eligible master-account users to borrow up to 1,000 USDT for a fixed 30-day term without liquidation triggered by price movements during the initial period.
The exchange announced the product on 4 August. Users can receive USDT immediately by locking eligible bitcoin as collateral, with the loan amount capped at 1,000 USDT.
Lite Loan charges a non-refundable service fee, which is deducted from the amount issued. No additional interest is charged during the first 30 days.
A promotional service fee of 0.5% applies to orders completed between 10:00 UTC on 4 August and 09:59 UTC on 3 September. Binance said the fee will return to 1% after the promotional period ends.
Bitcoin held in a user’s Spot or Funding Account is locked when used as collateral and moved into Binance Simple Earn. The pledged bitcoin continues to generate yield while the loan remains outstanding, but it cannot be withdrawn or transferred until the borrower has repaid the full balance and recovered the collateral through their Earn Account.
The fixed initial term gives borrowers a defined repayment period without requiring them to manage loan-to-value levels as bitcoin prices fluctuate, according to Binance.
Loan-to-value ratios determine the amount a user can borrow against collateral and indicate when that collateral could become subject to liquidation. Lite Loan is part of the broader Binance Loans platform, which also includes flexible-rate, fixed-rate and VIP borrowing products aimed at users with different loan sizes and repayment requirements.
Once the 30-day term expires, Binance applies penalty interest to any outstanding balance. The charge is set at a fixed simple annual rate of 36%.
A margin-call notification is issued when the loan-to-value ratio reaches 85%. Liquidation starts when the ratio reaches 91%, or when the loan remains overdue for 30 days, whichever comes first.
During liquidation, the pledged collateral is used to repay the entire loan. Binance currently sets the liquidation fee at 0%, although it said it may restore the standard 2% charge and apply a risk-based adjustment to the market value of individual collateral assets during the process.
Borrowers may make early or partial repayments without additional charges, using USDT or other eligible crypto assets. Requirements for collateral, borrowing limits, repayment schedules and loan-to-value calculations vary across Binance Loans products.
Lite Loan expands Binance’s lending range beyond its flexible-rate, fixed-rate, VIP and institutional offerings. It is designed for users seeking smaller loans, fixed repayment terms and a simpler borrowing structure.
Binance previously introduced institutional loans that support pooled collateral and more than 400 collateral assets.
The move comes as other large cryptocurrency exchanges develop similar forms of bitcoin-backed credit. Coinbase (Nasdaq: COIN) offers bitcoin-backed USDC loans with flexible repayment terms. Eligible customers can borrow up to 5,000,000 USDC against bitcoin, up to 1,000,000 USDC against ethereum, and up to 100,000 USDC against solana, cardano, XRP, litecoin and dogecoin, depending on the amount of collateral pledged.
Coinbase also says transfer limits apply to all accounts as a financial safeguard.
Separately, Binance’s newly launched US stock-trading service accumulated more than $400 million in assets under management within one week of its launch.
