Why it is sometimes possible to take out a bank loan to buy BTC

[gunhell16]

To get loan from Bank one has to full-fill lots of formalities before his loan is approved. You can get loan from bank to buy a car or for mortgage but there are not many Banks around who are willing to give you loan for Bitcoin investment because Banks don't like Bitcoin. Having said that even if there is Bank willing to give you loan for investing in Bitcoin then don't go for that option. Investment in bitcoin is not doubt profitable but over longer duration and there are certain rules and regulation of Bank loans which a borrower has to follow like you have to pay the instalment on time. There are chances that you invest in Bitcoin and price goes down for long duration, then as a borrower you have to pay the instalments along with interest from your pocket.

Many people take a loan for investment or business, most people treat Bitcoin as an investment, even banks hate Bitcoin, I don't think they won't give loan when you have valid collateral. Have you ever took a loan with a purpose to invest in Bitcoin?

The banks will reject your loan if you said the money will be used for gambling, as we know in the long run, the gambler will lose.

As long as your income enough to cover the installment and interest, even holding for long term won't be problem.

If you know that the bank will approve you for the loan you borrow from them, there is no reason for you to say that you will use it to invest in bitcoin, you can say another reason that they can accept, then is it mandatory for the bank to say the reason for which you will use it?

Because as far as I know, the bank is out of the question as to where you will use the money they will lend you, because what is important is that the bank knows
that you are capable of paying them back in the end.

[Becassine]

To close this topic, let's calculate this bitcointalker user's net worth today with a BTC value of €94,834.23 (coingecko today)

Borrowed amount: €50,000

Interest rate: 1.5% per year

Loan term: 5 years (from 11/19/2017 to 11/19/2022)

Current date: 26/05/2025

Purchase of Bitcoins on 19/11/2017

Taxation: The man is probably a French tax resident, French tax rules for capital gains on cryptocurrencies : flat tax of 30% on capital gains.

To calculate the cost of the loan, I used an online calculator (see link).

He would have had to pay €865/month, and his loan would have cost him only €1,930 in total.

https://www.meilleurtaux.com/credit-immobilier/simulation-de-pret-immobilier/calcul-des-mensualites.html

Bitcoin price on 19/11/2017: ~€6,800

Number of bitcoins purchased: 50,000 ÷ 6,800 ≈ 7.3529 bitcoins

Bitcoin price on 26/05/2025: €94,834.23 (coingecko)

For a €50,000 loan over 5 years (60 months) with monthly payments of €865: Total amount repaid: 865 × 60 = €51,900

Interest cost: 51,900 − 50,000 = €1,900

This is very close to the interest cost indicated (€1,930). The slight difference may be due to rounding or additional fees in the chosen calculator. For consistency, I will use the total interest cost of €1,930, resulting in a total loan cost of €51,930.

Bitcoin value as of 26/05/2025 : Number of bitcoins × Bitcoin price = 7.3529 × 94,834.23 ≈ €697,058.82

Gross assets = Value of bitcoins − Total cost of loan = 697,058.82 − 51,930 = €645,128.82

In France, to calculate the capital gains tax on cryptocurrencies, the acquisition price (amount invested, here €50,000) is subtracted from the sale price (value of the bitcoins at the time of sale, here €697,058.82).

Capital gains tax:

Tax = 647,058.82 × 30% = €194,117.65

Net assets = Gross assets − Tax = 645,128.82 − 194,117.65 = €451,011.17

France : If the man opts for the progressive income tax scale, the tax could vary according to his marginal tax bracket.

We can remove the purchase costs, loan administration fees and other costs, but roughly speaking it would have made a capital gain of 768%.

Bitcoin was, at least, a good investment in the past, probably no more dangerous than stocks and, for the time being, much more profitable.

Of course, with its volatility, it can be scary, and many investors have sold in panics over the period.

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Moral: Everyone should be able to invest based on theirs own circumstances, not their neighbor's. An investor should also be able to obtain information from multiple sources.