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P2P lending platform for crypto-backed loans
The most private, safe and fast way of lending secured with bitcoin collateral

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Frequently asked questions

Is Biterest a finance company or a bank?

How to become a borrower and apply for a loan?

Biterest respects privacy and does not require any personal information from the users. To become a borrower you only need to provide your email address.

To get a loan, we firstly recommend you to learn the loan offers published by the lenders. Choose the loan offer which matches your needs and apply for a loan. If none of the offers is suitable for you, click the Apply for a loan button, specify your own loan terms and wait for your application to be accepted by a lender

How to become a lender and issue a loan?

Biterest respects privacy and does not require any personal information from the users. To become a lender, you only need to provide your email address.

To issue a loan, choose a suitable loan application published by a borrower. and follow instructions to transfer the money. Currently, the lenders’ offers for issuing loans are in beta-testing mode. Contact our support to get additional information.

Do the borrower always need to provide collateral in order to get a loan?

Yes, on Biterest all loans must be collateralized with bitcoin. The borrower must transfer the necessary amount of Bitcoin to a multisig-address in order to secure the loan application with collateral. After the loan application has been collateralized, the borrower’s payment details become available to the lender who will transfer the money.

The borrower can provide the collateral in two ways: transfer the collateral upon submitting the loan application or publish the application on the platform and then transfer the collateral after the lender has accepted it.

How is the collateral amount calculated and what does it depend on?

The amount of collateral depends on the loan amount, annual interest rate, loan period and discount. The higher the discount the borrower indicates, the greater the amount of collateral that will be required. The required collateral amount is calculated on the average BTC / USD rate.

For example, a borrower applies for a loan: the loan amount is $1500, the annual interest rate is 20%, the loan period is 90 days. The total loan repayment amount is 1500 + 1500 x 20% x 90 / 365 = $1573,97. The discounted collateral value is 30%, so the initial collateral value is 1574 / (1 - 0,3) = $2248.57. For example, if the BTC price was $3600 at the moment of submitting a loan application, the collateral amount would be 0,62460278 BTC.

Where is the collateral held for the duration of the loan?

The collateral is stored on a multisig address until the end of the loan period. A new multisig address is created for each new loan because it is a combination of three public keys (borrower’s, lender’s and Biterest’s). To access the bitcoin on the multisig address requires at least two corresponding private keys. Each party of the loan owns only one private key. This means that neither Biterest or anyone else is able to get access to the collateral.

What happens to the loan if the bitcoin rate drops sharply and the collateral decreases significantly in value?

When the BTC rate decreases, the collateral value decreases too. If its value decreases and becomes equal to the repayment value (the amount which the borrower requires to payout to the lender), Margin Call will occur. This means that the loan forcedly stops and the lender receives Biterest’s private key to access the collateral.

To reduce the risk of Margin Call occurrence, the borrower needs to increase the discount rate. We recommend specifying it at least 30%.

What is the annual interest rate?

The annual interest rate is a percentage to a loan amount which the borrower pays to the lender for a one-year loan duration. If you get a loan of 10,000 USD for one year with an annual rate of 20%, you will pay 2,000 USD. If the loan duration is 90 days, then you will pay 493 USD (10,000 * 20% * 90/365 = 493).

Which loan transfer methods are available?

A requested loan amount can be transferred either in fiat currency (PayPal, Yandex.money, WebMoney, QIWI) or cryptocurrency (Bitcoin, Ethereum, Bitcoin Cash, Ripple). All transfers between the lender and the borrower are made directly.

Why is cryptocurrency the easiest way to receive a loan?

Using cryptocurrencies as a transfer method, you can get a loan in several minutes with a minimum commission regardless of how high a loan amount is or your current location. Then you can exchange it for a preferred cryptocurrency or easily convert into fiat currency.

The payment systems for electronic fiat currencies have restrictions on the amount being transferred depending on the user’s registration country. Please ensure in advance whether you are able to send or receive money using the selected payment system.