Court victory clears path for first Bitcoin mortgage in Australia
Crypto holders can now leverage Bitcoin for home loans, maintaining ownership and flexibility, as new lending products enter the Australian market.
Key Takeaways
- Block Earner won a court case against Australia's securities regulator, paving the way for the nation's first Bitcoin-backed home loans.
- Borrowers can use Bitcoin as collateral and retain ownership while accessing mortgage products with flexible repayment options.
Share this article
Australia is set to welcome its first-ever home loan backed by Bitcoin after a court ruling removed certain legal hurdles, opening new doors for crypto use in traditional finance.
Sydney-based fintech company Block Earner announced it would become the first company to offer Bitcoin-backed home loans in Australia after winning a legal victory that clarified its right to provide crypto-collateralized loans without needing a financial services license, according to news.com.au.
The company had faced legal action from the Australian Securities and Investments Commission (ASIC), which argued that Block Earner’s fixed-yield crypto lending products resembled investment products and therefore required licensing under financial services regulations.
While the Federal Court initially ruled in ASIC’s favor, that decision was overturned in April by the Full Federal Court. In a landmark judgment, the appellate court found that Block Earner’s products did not constitute “financial products” under Australian law.
As a result, the company is no longer required to obtain an Australian Financial Services Licence (AFSL) to operate its crypto-backed lending services, clearing legal hurdles for crypto-backed lending in Australia.
After the landmark victory, Block Earner plans to roll out mortgage products that allow crypto holders to use Bitcoin as collateral while retaining ownership of their digital assets. Interest rates will begin at 9.5% per annum with a 40% loan-to-value ratio, with comparison rates reaching 11.9% per annum at 80% LVR.
“Crypto holders shouldn’t have to choose between holding Bitcoin and buying a home. We’re giving them a smarter option, a way to put their crypto to work without giving it up,” said Block Earner CEO Charlie Karaboga in a statement.
According to Block Earner, property affordability has shifted largely when measured in Bitcoin terms. In 2016, the average Australian home cost 627 BTC, but by 2024, that figure had dropped to just 4.3 BTC.
The company has already accumulated more than $110 million in mortgage demand during its soft launch. Customers can make interest-only payments for up to four years using either crypto or Australian dollars, with loan approvals promised within 24 hours and no early repayment fees.
Share this article
