I replayed a BTC-backed loan on every day since 2014. Even at 20% LTV, some got liquidated

Many of us have looked at borrowing against our coins instead of selling. The offers show the interest rate. I wanted to know something they don’t show: how often a loan like that would actually have been liquidated.

So I replayed one on real hourly BTC prices (USD), starting a new loan on every day since 1 Jan 2014.

The loan: 12 months, 50% starting LTV, margin call at 70% with 48 hours to top up, liquidation at 80%.

Results

• 41 of 100 start days ended with the coins sold by the lender.
• At 20% starting LTV, 4 of 100 one-year loans were still liquidated. No LTV I tested survived every start day.
• 56 of 100 margin calls came at night or on a weekend (Central European Time).
• Raising the liquidation LTV from 80% to 90%, or getting 72 hours to top up instead of 48, changed almost nothing. A lower starting LTV and a shorter loan made the real difference.

Caveat: start days close together share the same crashes (2018, 2022...). So there are fewer independent events behind these counts than the numbers suggest.

Why I’m posting

I built a free tool from this, because I wanted to check offers myself: bitcoinloancheck.com

You enter the terms of an offer. It shows the chance of a liquidation before the loan ends, the liquidation price, and what the loan costs compared with selling. Full tables are on the Insights page.

To be upfront about what it is:

• It’s my own project. I don’t work for a lender, and none is named, ranked or paid on the site. No referral links, no ads.
• No account, no cookies, no tracking. It runs in your browser and your numbers never leave it.
• Open source (MIT): github.com/boddenlennart/btc-loan-risk
• It shows what happened in the past, not what will happen, and it isn’t advice.

I’d honestly like to receive your feedback. If something looks off, or a loan term you’ve seen can’t be entered, tell me in the comments.