✍️ Author: Karel Havlíček – Bitcoin Analyst & Editor · 📅 Updated:
What Firefish is and what problem it solves
Firefish is a European platform with Czech roots connecting two groups: bitcoin holders who need cash but don’t want to sell (triggering taxes and losing their position), and investors who want interest on loans secured by the most liquid collateral in the world.
The principle: the borrower locks BTC into escrow, the investor sends money (EUR/CZK), and after repayment the bitcoin returns to the borrower. Throughout the loan the BTC sits in multisig escrow – the platform cannot freely move it, does not lend it out and does not rehypothecate.
- BTC holders needing one-off cash (renovation, taxes, business)
- Long-term hodlers who don’t want a taxable sale
- Investors seeking interest secured by bitcoin collateral
- Companies holding BTC that need working capital
How the collateral works and what LTV means
Loans are over-collateralised: you typically lock more BTC value than you borrow (LTV around 50% – a €5,000 loan means roughly €10,000 in BTC). If the BTC price drops sharply and LTV crosses the threshold, you get a margin call to top up collateral; failing that, part of the BTC is liquidated to repay the loan.
Interest is set by the market – investor offers vary by term and currency. Terms range from months to about a year or more. Always verify current rates, LTV thresholds and fees directly in the app – they move with the market.
How to start step by step
- Register and complete KYC verification.
- As a borrower: enter amount, currency and term – you’ll see interest offers.
- Lock your BTC collateral into multisig escrow (the platform generates the address; keys are held by multiple parties).
- An investor funds the loan and the money lands in your account.
- Repay on schedule – the bitcoin unlocks back to your wallet.
🎬 Video tutorials for Firefish (YouTube)
Risks you must understand
The main risk is a falling BTC price: in a sharp crash you can lose part of your collateral to liquidation. Never borrow against bitcoin for consumption you cannot repay, and keep a reserve to top up collateral. For investors: interest is a risk premium – read the terms and diversify across several loans.
A loan against BTC is usually not a taxable event (unlike a sale) – but always confirm the tax treatment with an advisor in your country. Context in our practical guide.
✅ Pros
- Cash without selling BTC (no sale tax event)
- Multisig escrow – no re-lending of your coins
- Market-driven interest rates
- Works for investors seeking secured yield too
- European platform, EUR and CZK
⚠️ Cons
- Liquidation risk if BTC price falls
- Over-collateralisation ties up more capital than you borrow
- KYC required; rates and limits move with the market
❓ Frequently asked questions
Do I lose my bitcoin when I borrow?
No – as long as you repay and the price stays above the liquidation threshold. The BTC sits in multisig escrow and returns to you after repayment.
What happens if the BTC price drops?
When LTV crosses the threshold you get a margin call to add collateral; if you don’t and the drop continues, part of the BTC is liquidated to repay the loan.
Is a loan against BTC taxable?
The loan itself is usually not taxable income – unlike selling BTC. Confirm the specifics with a tax advisor in your country.
Can I invest on Firefish too?
Yes – as an investor you fund other people’s loans and earn interest. The yield is secured by bitcoin collateral but not risk-free; diversify.
This article contains affiliate links (rel="sponsored") – they support our educational project and change neither your price nor our opinion. Not financial advice; always verify current terms directly with the provider.