Bitcoin-Backed Mortgages Enter Canada, but the True Borrowing Costs Remain Unclear

Canadian financial services firm APX Lending plans to roll out mortgages backed by Bitcoin in the first quarter of 2027, allowing homebuyers to borrow against their cryptocurrency holdings rather than sell them to fund a property purchase. The proposed product could be used to cover a down payment or potentially finance an entire home, although the company has not yet announced its rates or full lending conditions.

The Toronto-based lender opened a waitlist on Wednesday as it prepares for the planned launch. APX already provides crypto-backed loans and says its upcoming service could make it Canada’s first regulated provider of Bitcoin-backed mortgages.

Last month, APX also announced five-year lines of credit secured by Bitcoin and Ethereum. The planned mortgage service would expand its lending business into Canada’s housing sector, where mortgage debt stood at $1.75 trillion in June, according to the Canada Mortgage and Housing Corporation.

In the United States, Miami-based lender Milo has already developed a market for similar products. The company reported in February that it had originated more than $100 million in crypto-backed mortgages, including a $12 million loan. Its offerings allow borrowers to use Bitcoin or Ether as collateral, with repayment periods reaching 30 years.

APX founder and CEO Andrei Poliakov told CoinDesk that Canada’s Bitcoin-backed real estate financing market could reach an estimated $60 million to $100 million. He added that real estate transactions currently account for 15.8% of APX’s existing crypto-backed lending volume.

Poliakov provided an example involving a property worth approximately $650,000. A buyer could obtain $95,000 to cover a 20% down payment by pledging $190,000 worth of Bitcoin. Someone seeking to finance the full purchase without contributing a cash down payment would need to pledge around $465,000 in BTC, while the property would also serve as collateral.

APX Has Not Disclosed Mortgage Pricing or Lending Limits

The company has yet to publish the planned mortgage’s interest rates, repayment schedules, loan-to-value limits, or rules governing margin calls and the liquidation of collateral.

APX’s current crypto-backed loans carry annual interest rates between 9.99% and 11.49%, with a 60% loan-to-value ratio. However, the lender has not confirmed whether those figures will apply to its mortgage offering.

Poliakov said using the property as additional security could help bring down borrowing costs, but he declined to provide an expected interest rate.

Bitcoin’s volatility remains a central risk for borrowers. A substantial decline in BTC’s market value could force customers to add collateral or face the sale of some of their holdings, depending on the conditions of their loan agreements.

Poliakov explained that a 40% drop in Bitcoin’s price would increase the loan-to-value ratio of a standalone loan that began at 50% to roughly 83%. Mortgages secured by both Bitcoin and real estate would be assessed using a different framework.

Bitcoin Price Declines Could Trigger Collateral Measures

APX said it relies on BitGo to custody customers’ digital assets and does not lend out the cryptocurrency pledged as collateral. Its existing lending platform includes automated safeguards that sell part of a borrower’s Bitcoin when the loan-to-value ratio reaches 90%, bringing it back to 85%.

The planned mortgage product will have separate provisions covering collateral requirements, defaults, notice periods, and opportunities for borrowers to remedy collateral shortfalls.

Poliakov stressed that selling Bitcoin collateral and enforcing a mortgage against a home are separate actions. Whether a borrower could ultimately face a risk to their property because of a collateral shortfall would depend on the terms of the individual agreement.

“Canadians shouldn’t have to choose between owning Bitcoin and owning a home,” Poliakov said.

Potential customers can register for the waitlist while the company finalizes its offering. APX has not specified when the complete mortgage terms will be released, but Poliakov said they would be made public before the anticipated launch in early 2027.