Bitcoin lending as a sales instrument for mortgage lenders

How can mortgage lenders win clients who hold part of their wealth in Bitcoin? Our answer in the short paper “Bitcoin Lending as a Sales Channel”: Bitcoin lending as a sales instrument. Clients deposit Bitcoin with the bank and in return receive better terms for their mortgage, without having to sell their Bitcoin.

Key points at a glance

• The private mortgage market is highly competitive and margins are shrinking. At the same time, more and more people in Germany hold cryptocurrencies, mainly Bitcoin.
• Bitcoin lending combines the two: clients who deposit Bitcoin with the bank receive a fee that reduces their net loan payment. The Bitcoin remain the client’s and are available again after the agreed term.
• The bank funds the interest benefit from its budget for sales incentives, not from income generated with the Bitcoin.
• By our estimate, the target group comprises around 120,000 clients.

Starting point

New business in private mortgage lending in Germany was still around 20% below pre-crisis levels at the beginning of 2025; banks face intense competition and shrinking margins. At the same time, around 7.6 million people in Germany hold cryptocurrencies, predominantly Bitcoin.

This opens up a new business opportunity. Bitcoin lending can attract new client segments and win back existing clients who have moved parts of their brokerage and crypto business to neobrokers and other competitors.

How does Bitcoin lending work in mortgage lending?

The product could be designed as follows:

• As part of their mortgage contract, clients can deposit Bitcoin with the bank’s custody solution. If they choose this option, they receive preferential mortgage terms.
• The Bitcoin remain the client’s: securely held and retrievable after the agreed term.
• The bank compensates the client for the deposited Bitcoin. This reduces the client’s net loan payment to the bank.

The bank does not generate direct income from the Bitcoin. Instead, it funds the lower mortgage interest rate from its budget for sales incentives. In short: the Bitcoin deposit becomes a lever to win new mortgage business.

Why is Bitcoin lending worthwhile for mortgage lenders?

• Differentiation: combining two previously separate areas sets mortgage lenders apart from the competition.
• New and returning clients: the offer opens up new client segments and provides an opportunity to win back existing clients.
• Cross-selling: it links the crypto sector with conventional financing needs, which is particularly interesting for institutions expanding their digital asset business.
• Strategic window: the European regulatory framework for digital assets is evolving rapidly. With MiCAR and greater clarity from BaFin on crypto services, there is a strategic window: institutions that act now can shape product standards and client expectations for the years ahead.

How large is the target group?

We assume that the target group for mortgages invests in cryptocurrencies more often than average, for demographic and socio-economic reasons. A rough estimate:

The result: a relevant market that can be addressed efficiently with a dedicated go-to-market strategy and that offers significant revenue potential, even after the costs of the programme.

FAQ

Do clients have to sell their Bitcoin?
No. They deposit them with the bank and can access them again after the agreed term.

Where does the interest benefit come from?
From the bank’s budget for sales incentives. The bank does not generate direct income from the Bitcoin themselves.

How large is the target group?
By our rough estimate, around 120,000 clients.

Planning to offer Bitcoin lending?

FinPlanet supports banks and mortgage lenders in building, scaling and monetising DLT-based business models, with expertise in digital assets and token economics, strategic know-how in product development and go-to-market planning, and experience in operationalising complex crypto offerings within financial institutions. Contact us at info@finplanet.eu.

Short paper to download

You can download the full short paper “Bitcoin Lending as a Sales Channel” here as a PDF or via the "Download PDF" button below the article.