About the Loan Product
What is the nature of the Busha Loan Product?
The Loan Product allows you to access and obtain flexible loans by pledging approved digital assets as collateral. These are crypto-backed loans and do not follow the structure of traditional bank loans.
What are the key differences between a Busha loan and a traditional bank loan?
Busha loans do not impose a fixed repayment date. Instead, you may repay the entire outstanding principal or reduce it partially at any time. Your loan remains in good standing as long as you meet your monthly interest obligations and preserve the value of your Collateral within the acceptable Loan Collateral Percentage.
What crypto assets are currently supported as collateral?
The Loan Product is currently limited to Bitcoin (BTC), Tether (USDT) and SOLANA (SOL). Busha retains the sole discretion to introduce or remove supported assets at any time. And the following assets can be used as collateral; USDT, USDC, BTC, ETH, & SOL.
When does a loan become active?
A Loan becomes active only upon Busha’s confirmation that all eligibility, collateral, risk, and compliance requirements have been satisfied. Busha may decline or suspend any application at its sole discretion until this confirmation.
Eligibility and Account Requirements
What are the eligibility requirements for accessing the Loan Product?
Access is limited to Users who have maintained an active Busha account for a minimum period determined by Busha, which shall not be less than three months and may extend to six months, depending on Busha's risk and compliance considerations.
How does Busha determine if I am eligible?
Busha makes the determination in its absolute discretion, taking into account factors like trading activity, account behavior, verification status, and any necessary compliance-related findings. Busha is not required to disclose its assessment criteria.
Collateral, Interest, and Repayment
How does the Loan Collateral Percentage work?
The level of funds available to you and the risk associated with the Loan depend on the aggregate market value of your Collateral and the applicable Loan Collateral Percentage. You will be shown this percentage and the corresponding liquidation point(s) when applying for a loan. Consistent and timely payments typically result in a more favorable collateral percentage and reduce the risk of liquidation.
What happens to my collateral once it is pledged?
By pledging Collateral, you grant Busha a first-priority, continuing, and irrevocable security interest in the Collateral assets. You authorize Busha to hold, manage, convert, or otherwise utilize the Collateral for liquidity, risk management, operational, or regulatory purposes.
Can I withdraw or use my pledged collateral?
No. From the moment Collateral is pledged, you shall not withdraw, transfer, assign, encumber, or create any interest whatsoever in the Collateral until the Loan has been fully repaid and Busha confirms its release.
How are interest rates determined?
Interest rates are determined solely by Busha and depend on prevailing market conditions, the nature of the Collateral, and the exchange rate volatility between the Collateral and the Loan currency. These rates may be revised periodically.
What are my repayment obligations?
You may repay the principal amount of your Loan, in whole or in part, at any time without penalty. However, you must pay monthly interest on or before the due date communicated to you.
How is the monthly interest deducted?
Monthly interest shall first be deducted from your fiat balance. If the fiat balance is insufficient, you expressly authorize Busha to deduct any outstanding interest from your Collateral. Any deduction from your Collateral will reduce its value and may bring you closer to the liquidation point.