Last updated: 20.07.2026
Crypto-Asset-Backed Loans in the Context of Polish and European Regulations
The market for crypto-backed loans has undergone a major transformation in recent years, evolving from a sector known exclusively to technology enthusiasts to a completely widespread financial service, where crypto backed loans work as an everyday financial tool, offered by a significant portion of the market. Europe occupies an exceptionally strong position on the global map of financial innovations, digital assets, and the broader crypto space.
According to an industry report by Dataintelo, the global crypto-asset-backed lending market reached a value of USD 14.8 billion in 2025. The European market share is estimated at 27.2%, ranking it second globally, behind only the American market.
This area encompasses, on the one hand, the direct provisioning of loans in crypto-assets and, on the other hand (a model that is currently gaining dominant commercial significance), the provisioning of loans in traditional funds (fiat currency), for which crypto-assets deposited by the borrower serve as hard property collateral.
Market Outlook for Crypto-Backed Loans and Digital Assets
The future of the crypto-asset-backed lending industry looks highly promising. The global crypto-backed lending market is projected to grow to USD 82.6 billion by 2034. In other words, market growth will exceed 21% year-over-year.
Furthermore, it is worth noting the scale of development within the DeFi industry. Reports from Precedence Research estimate that the value of this market exceeded USD 50 billion at the beginning of 2026, and experts assume that this segment will expand at a staggering annual growth rate of 42–50%.
This growth is driven not only by retail users, but also by institutional investors, high-net-worth individuals, and market participants seeking crypto-backed loan options ith competitive interest rates as an alternative to conventional loans offered by traditional financial institutions.
Legal Qualification of Crypto-Assets and Loans Under Polish Law
The seemingly simple activity of granting loans based on crypto-assets is, in fact, an intersection of several branches of law, particularly:
- civil law;
- public financial market regulations;
- consumer protection law;
- tax law.
To better understand the legal status of crypto-assets in Poland, it must be clarified that crypto-assets do not constitute money within the meaning of legal tender issued by central banks. Nor do they meet the definition of a “thing” (corporeal object) under the Polish Civil Code, as they are inherently entirely intangible entities, representing merely a cryptographic record within the architecture of a distributed blockchain network.
In the Polish legal framework, it is established that crypto-assets should be classified as transferable property rights. The specific legal status of crypto-assets means that provisions governing the standard rules of cash lending do not ultimately apply to them, which entails significant practical consequences.
For instance, granting loans in crypto-assets will generally not involve the necessity of obtaining an entry into the Register of Lending Institutions or complying with the provisions of the Consumer Credit Directive (CCD2). Consequently, this legal positioning does not mean that loans in crypto-assets are prohibited or that turnover is impossible.
It is also worth emphasizing at this point that the draft regulations concerning the establishment of a prohibition on such loans did not enter into force. In recent announcements, the Minister of Finance confirmed that no legislative work in this regard will be pursued.
How Does Crypto-Asset Lending Work Under MiCA?
Intuitively, it might seem that Regulation (EU) 2023/1114 of the European Parliament and of the Council on markets in crypto-assets (MiCAR) comprehensively addresses services closely linked to crypto, but the reality is quite different.
MiCAR does not regulate the rules of providing crypto-asset loans at all. One of the recitals of the regulation merely states that Member States are free to regulate this area of the crypto market; however, no directives or suggestions were provided.
When Does a Crypto Lending Platform Need a CASP Licence?
Although providing loans is not explicitly listed as a distinct service provided by a CASP, in practice, operating a professional, centralized platform independently is impossible without performing other activities strictly regulated under MiCAR. Such activity therefore requires obtaining a CASP licence or, at the very least, establishing cooperation with an authorized entity.
The complex process of providing a loan backed by crypto-assets typically requires:
- accepting crypto-assets from the client and managing cryptographic keys, which is qualified as the custody and administration of crypto-assets on behalf of clients, including cases where the platform holds or controls customer funds, crypto holdings, or other supported assets;
- the potential liquidation of the collateral, which constitutes the exchange of crypto-assets for funds or other crypto-assets.
- the transfer of crypto-assets that are the subject of the loan or its collateral, which is defined as providing transfer services for crypto-assets on behalf of clients.
Rendering services from this catalogue requires obtaining a Class 2 CASP licence. We have written about the requirements for CASP licence here.
A detailed market map of this sector was outlined in the report by European supervisors from January 2025 (Joint EBA-ESMA Report regarding recent developments in crypto-assets). Crucially for the FinTech industry, the report highlighted the potential inherent within it. Analyzing the crypto lending segment in detail, the European supervisory authorities confirmed two facts of key business significance:
- Firstly, these services have become completely widespread in the European Union.
- Secondly , traditional banks practically do not provide such services, which opens new opportunities for FinTechs already existing on the market.
From the perspective of planning a future business model, it is important that European regulators favor only partial regulation of this area (focused primarily on traditional intermediaries and end-service providers, including payment service providers), which with our legal support will allow for a better design of the assumptions of future services.
Crypto-Asset Lending Models
Rich market practice accounts for the diversity of services available on the market. Market models can be classified by taking into account the role and status of the lender (e.g., VASP or CASP).
Fiat Loans Backed by Crypto Collateral
In this model, the user deposits crypto-assets (e.g., BTC) as collateral and receives a transfer in fiat currency (e.g., USD, EUR, PLN) to their bank account. This allows them to access liquidity and retain ownership of their digital assets, getting fast access to a transfer in fiat currency to their bank account.
Crypto-to-Crypto Loans
The user deposits one cryptocurrency as collateral to borrow another (e.g., pledging Ethereum to borrow the USDT stablecoin).
Margin Lending
A service primarily offered by crypto exchanges. The exchange (or other users through it) lends funds so that the borrower can open a position with a value exceeding their own capital.
Earn / CeFi Lending
The user lends their crypto-assets to the platform in exchange for regularly paid interest (or yield in general). The exchange uses these funds by lending them to institutions or utilizing them for liquidity provision. In the report of European regulators, such a model was classified as borrowing.
DeFi Models – How Crypto Loans Work Without a Centralized Lending Platform
In DeFi, at no stage of providing a loan does an intermediary acting as a CASP appear. Services are rendered directly on the blockchain via code, i.e., through the use of smart contracts. The user connects using their private wallet.
Commonly utilized models include:
- Overcollateralized Lending Pools. Users wishing to earn interest deposit funds into a common “pool”. In turn, borrowers can draw from this pool, provided they deposit collateral of a higher value than the loan being taken, maintaining an appropriate loan to value ratio. This baseline loan to value metric, often referred to as the ltv ratio, ensures stability (e.g., depositing USD 1,500 in ETH to borrow USD 1,000 in USDC). The interest rate, or annual percentage rate, is determined algorithmically based on supply and demand.
- Flash Loans. A user can borrow any amount, regardless of size, without any collateral, under one condition: the entire loan plus a fee must be returned within the same, single transaction (block) on the blockchain. If the operation (e.g., arbitrage between two DeFi exchanges) does not yield a profit sufficient for repayment, the transaction simply fails to execute, and the loan is treated as if it had never been granted.
P2P Lending Models and Smart Contract-Based Loan Terms
The platform (either a centralized exchange CEX or a decentralized exchange DEX) merely serves as a bulletin board. The lender and the borrower determine the terms themselves: the amount, the type of collateral, the duration, and the interest rate.
Once both parties agree, the smart contract or the platform locks the collateral and transfers the funds.
Loans in Stablecoins (EMTs)
An interesting case involves Crypto-to-Crypto models where a user deposits one cryptocurrency to borrow another, such as a stablecoin.
The MiCA Regulation introduces a specific classification for Electronic Money Tokens (EMTs). From a legal standpoint, EMTs (issued in accordance with MiCAR) are recognized as electronic money.
Providing electronic money loans targeted at consumers is treated by supervisory authorities on equal terms with loans in fiat currencies.
This means that while lending crypto-assets that are not EMTs, such as Bitcoin or Ethereum, may not fall under the regime of the Consumer Credit Act, funding clients’ wallets with loans in MiCA compliant stablecoins (such as USDC or EURC) carries a high risk of such activity being deemed subject to CCD2 requirements and registration obligations.
Staking – CASP Authorisation and Interest Restrictions Under MiCAR
Staking consists of immobilizing crypto-assets to support the operations of Proof-of-Stake (PoS) network consensus mechanisms in exchange for block rewards.
The aforementioned report by European regulators describes the following staking models:
- a) Validator-as-a-Service (VaaS). Providing technical infrastructure (a validating node) for clients.
- b) Staking via CEX. Integrating the service directly into the crypto exchange ecosystem, enabling retail clients to participate in rewards without the need to manage private keys independently.
- c) Liquid Staking. Issuing liquid staking tokens (LSTs) representing a certificate of ownership of the frozen capital, allowing users to maintain liquidity and utilize LSTs in other areas of the market.
ESMA explicitly confirmed in Q&A No. 2067 that staking is not prohibited under MiCAR, but providing this service to clients involving the safekeeping of their crypto-assets may require a CASP authorisation.
Crucial in the context of loans is the prohibition on CASPs granting interest to holders of ARTs and EMTs for the mere passive possession of these tokens over a specified period, meaning a situation where the user receives a profit solely for holding tokens in their wallet or on a given platform, in accordance with Article 40(3) and Article 50(3) MiCAR.
Summary: Crypto-Backed Loans vs. Regulatory Risks
Establishing specific legal requirements, obligations, and risk structures associated with providing the aforementioned services requires an individual analysis of the respective business models in each case.
We offer not only the drafting of legal opinions regarding the classification of services and the outlining of regulatory risks, but also ensuring compliance with all other requirements, i.e.:
- the development of AML/CFT procedures,
- obtaining lending institution status,
- matters related to CCD2 and Polish consumer law,
- MiCAR and Polish regulations (especially with regard to the prohibition on granting interest for holding stablecoins).
If you are considering a larger business project and a gradual transition from a small lending platform for businesses to a significant player operating legally in Poland, and subsequently across Europe (as a registered lending institution) alongside cooperating with a CASP for crypto-based services, we will gladly prepare regulatory and tax recommendations tailored to your specific stages of development.
Contact our team if you would like to discuss the legal aspects of crypto-backed financing.
FAQ – Crypto-asset Backed Loans
When, as a general rule, should you adapt your business model to the requirements of CCD2 and consumer law?
The legal situation changes drastically depending on the adopted market model. If you want to offer traditional currency loans secured by crypto-assets, where the user deposits, for example, BTC and receives a transfer in fiat currency to their bank account, and you direct the offer to consumers (meaning the client is a natural person not engaged in business activity), then this transaction takes on the character of a classic consumer credit. In such a situation, the lending entity (even if it holds CASP status):
- must obtain an entry into the Register of Lending Institutions conducted by the Polish Financial Supervision Authority (KNF).
- is subject to the provisions of the CCD2 directive and the Polish Consumer Credit Act.
- is obliged to conduct a creditworthiness assessment of the borrower.
- must strictly comply with consumer rights, including the limits on non-interest consumer credit costs, restrictions on collateral, and the right to withdraw from the contract within 14 days.
Infringement of the provisions of the Consumer Credit Act may lead to far-reaching negative consequences for the lender. Depending on the severity of the infringement, the legislator has provided for the possibility of the consumer invoking the so-called free credit sanction. This mechanism entitles the consumer to return the borrowed loan amount without being required to bear any additional costs or pay any accrued commissions and interest (or with their statutory limitation), while retaining the right to fully claim the return of all originally locked cryptographic assets constituting the collateral.
Can an obtained lending institution licence be “passported” to other EU countries, just like a crypto exchange licence?
Definitely not. In this area, we must separate two distinct regulatory regimes.
Entities holding CASP licences granted under the MiCA Regulation may operate across the EU following a successful notification of services. Despite the EU’s CCD2 directive, an entry into the Polish Register of Lending Institutions authorizes the provisioning of loans exclusively in accordance with Polish law. Entering markets such as Germany or Spain with consumer loans requires an individual analysis and adaptation to the national regulations of the respective country each time. Consequently, in the case of lending institutions, there is no possibility of passporting services in the manner of a CASP.
Does the liquidation of a deposit (Margin Call) carry consequences on the grounds of income tax (PIT/CIT)?
Yes, and this is an element frequently overlooked when modeling a business plan.
- From a civil law perspective, a drastic drop in the value of a crypto-asset causes a so-called event of default, and the ownership of the collateral transfers to the lender.
- When an institution immediately sells such crypto-assets on the open exchange market to recover capital, from a tax law perspective, this de facto constitutes a disposal of virtual currency on behalf of the borrower. This imposes an obligation on the user to recognize income from capital gains and pay a flat-rate income tax at the rate of 19%. The terms and conditions of your platform must transparently warn consumers of such a scenario.
My project relies exclusively on DeFi and Smart Contracts. Do I still bear legal liability for potential technical issues affecting the provided loans?
Merely using fully decentralized solutions and making services available directly on the blockchain via code, despite not being regulated by the MiCA Regulation, does not exclude the civil (tort or contractual) liability of the creators toward users harmed by them. In this case, we advise staying up to date, as according to the geopolitical and regulatory shifts noted in the aforementioned ESMA and EBA report, conducting activities in this scope will also be regulated.
What is the relationship between the TFR regulation and crypto-based loans?
When planning a lending activity, one cannot overlook the Regulation on information accompanying transfers of funds and certain crypto-assets (TFR, Travel Rule). This regulation applies directly to crypto-asset-backed lending models.
Any movement of crypto-assets (including the deposit of collateral by the borrower, the payout of a loan tranche, or transfers executed as part of a Margin Call) constitutes a transfer within the meaning of the TFR. A CASP participating in such a transaction must collect, verify, and transfer data regarding the originator and the beneficiary.
A particular challenge for lending platforms is transfers from users’ private wallets (i.e., unhosted wallets), which DeFi models frequently rely upon. In the event of accepting collateral from them with a value exceeding EUR 1,000, the CASP must apply advanced risk assessment measures and verify whether the borrower actually exerts control over the given private wallet.
I want to launch a crypto-crowdlending platform. Does such a model also fall under the lending institutions regime?
As a rule, no. Generally, this business model involves the intersection of consumer law provisions, MiCAR, and the EU framework for crowdfunding. The mere fact that the loan capital originates from the community (in a P2P model) rather than from own funds will not allow you to avoid the legal classification described below.
Depending on the technical and business details of the platform model’s construction, you must anticipate at least a few key challenges:
- direct coverage by the CCD2 regime: If the planned platform connects investors with borrowers who are natural persons (for private purposes), and the subject of the loan is, for example, stablecoins (recognized as electronic money under MiCA), the loan may be deemed a consumer credit. As the operator, you will have to implement full creditworthiness assessment procedures and strictly adhere to credit cost limits.
- the necessity of obtaining a CASP licence: Even acting as an intermediary (e.g., as an extended bulletin board enabling users to create accounts and deposit crypto-assets) is not exempt from regulatory requirements. If, in the process of servicing social loans, the platform accepts crypto-assets as collateral for the duration of the loan agreement and manages clients’ private keys or handles token transfers, such activities constitute at least two services described under MiCAR.
- the risk of falling under the ECSP (European crowdfunding service providers for business) Regulation: In a situation where the business model assumes crypto-crowdlending exclusively for entrepreneurs (B2B models), the platform may be classified as a crowdfunding service provider within the meaning of the EU ECSP Regulation, which in turn may imply the necessity of obtaining an authorization.
As can be seen, creating a crypto-crowdlending platform requires consultation and verification of business assumptions. We will gladly assist in analyzing your business model to avoid any regulatory risks and ensure the most optimal development path for your business.
