Bitcoin Loan Rates: How to Borrow at 1% with Mezo

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In traditional finance, securing a mortgage at a 1% interest rate sounds like a fantasy. But in the evolving world of decentralized finance (DeFi), that reality is now possible — not for home loans, but for Bitcoin-backed borrowing. With Mezo, BTC holders can access a stablecoin line of credit at a groundbreaking 1% fixed interest rate, unlocking liquidity without selling their long-term holdings.

This isn’t speculative hype. It’s a functional financial tool designed for Bitcoin maximalists who want to use their assets while preserving ownership. Whether you're funding real-world expenses, investing in onchain opportunities, or simply optimizing your capital efficiency, Mezo offers a seamless way to borrow against Bitcoin with unprecedented terms.

👉 Discover how to unlock low-cost liquidity using your Bitcoin today.

Step 1: Create a Mezo Account to Access Bitcoin Loans

To begin borrowing, you’ll first need to create an account on Mezo. Currently, the platform supports desktop access only, ensuring a secure and stable user experience during onboarding.

Visit the official Mezo interface and click “Sign in” in the top-right corner to start registration. You can connect using either Bitcoin-native wallets or EVM-compatible wallets, including:

Hardware wallets like Ledger are fully supported through compatible extensions, giving users full custody and enhanced security.

Once logged in, your dashboard displays all connected assets — BTC, MUSD (Mezo’s native dollar-pegged stablecoin), mats, and various Bitcoin-wrapped tokens (e.g., cbBTC, solvBTC). From the “Overview” page, you can deposit BTC as collateral or proceed directly to borrowing.

Step 2: Borrow MUSD at 1% Fixed Interest Rate

The core innovation of Mezo lies in its ability to offer fixed-rate loans in a space where variable rates dominate. When you open a loan position, your interest rate is locked in at 1% annually — and it remains unchanged for the life of the loan.

Minimum borrow amount: 1,800 MUSD
Liquidation threshold: 110% collateralization ratio (CR)

After navigating to the “Borrow” tab, input your desired loan amount. The system will display key metrics:

Once confirmed, your loan is active. You’ll gain immediate access to MUSD while retaining full ownership of your BTC through non-custodial smart contracts.

How Maximum Borrowing Capacity Works

Your maximum loan limit is calculated at the time of position creation based on:

For example:

  • BTC price: $100,000
  • Collateral: 10 BTC ($1 million value)
  • Max borrow capacity: 900,000 MUSD (at 110% CR)

You don’t need to borrow the full amount upfront. Start with 2,000 MUSD and draw more later — all within your fixed limit — without refinancing or rate changes.

This creates a flexible credit line perfect for strategic capital deployment.

Actions That Preserve Your 1% Rate

One of Mezo’s standout features is flexibility without penalty. The following actions do not trigger refinancing:

Even when issuing new MUSD, only a nominal issuance fee applies — your interest rate stays fixed at 1%.

👉 See how you can leverage your Bitcoin without giving up control.

Step 3: Use MUSD in Real-World and Onchain Markets

Now that you’ve secured low-cost capital, what can you do with MUSD?

Mezo integrates with several services to bridge crypto wealth into everyday utility:

Imagine using borrowed MUSD to pay for dinner — and if Bitcoin doubles in value, the appreciation far exceeds your minimal interest cost. In essence, your meal was nearly free.

Beyond daily spending, future updates will expand MUSD’s utility:

Soon, spending MUSD will feel as natural as using traditional bank funds — but powered entirely by your Bitcoin collateral.

Step 4: Repay and Retrieve Your Bitcoin

Closing your loan is straightforward. Return to the “Borrow” tab, select “Manage loan,” and choose full or partial repayment.

If you’ve spent your MUSD, you may need to acquire more before settling the debt. Upcoming features like Mezo Swap will allow direct conversion from USDT, USDC, or other stablecoins into MUSD — simplifying repayment logistics.

Once the principal and accrued interest are repaid, your BTC is automatically released back to your wallet. No intermediaries. No delays. Everything happens transparently onchain.

This permissionless cycle — deposit, borrow, spend, repay — empowers users to bank on themselves, avoiding capital gains triggers and third-party custody risks.

Core Keywords & SEO Optimization

This guide centers around high-intent financial queries related to Bitcoin lending. Key SEO keywords naturally integrated include:

These terms reflect active search behavior among crypto-savvy investors seeking liquidity solutions that align with self-sovereignty principles.

Frequently Asked Questions (FAQs)

What are Bitcoin loan rates and how are they determined?

Bitcoin loan rates are the interest charges applied when borrowing against BTC collateral. They vary by platform based on liquidity, demand, and risk models. Mezo offers a rare fixed 1% rate, set at loan initiation and governed by protocol rules.

Is it safe to take a crypto loan using Bitcoin as collateral?

Yes — if using a secure, transparent platform like Mezo. Since loans are non-custodial and executed onchain, you retain control of your BTC. However, monitor your collateralization ratio closely; falling below 110% risks liquidation during price drops.

Can I borrow without selling my Bitcoin?

Absolutely. Mezo allows you to generate liquidity via MUSD loans while keeping full exposure to BTC’s price appreciation — ideal for avoiding taxes and maintaining long-term positions.

What happens if Bitcoin’s price drops after I borrow?

A declining BTC price reduces your collateralization ratio. If it nears 110%, you must add more BTC or repay part of the loan to avoid liquidation. Mezo provides real-time dashboards to help manage this risk proactively.

How does the fixed interest rate work?

Once you open a loan, the interest rate is locked for its entire duration. Even if market rates rise or you draw additional funds (within limits), your rate remains unchanged at 1%.

How do I repay my Bitcoin-backed loan?

Repayment occurs directly through the Mezo dApp by returning the owed MUSD plus interest. Upon settlement, your BTC is automatically unlocked and available for withdrawal.

👉 Start leveraging your Bitcoin with one of the lowest borrowing rates available.