Bitcoin-backed lending just received a major boost with the announcement that Turlov Family Office Securities (TFOS) now allows South Africans to borrow in USD against their bitcoin (BTC) holdings.
The problem facing many bitcoin holders is how they can leverage their BTC holdings without selling them.
That problem has now been solved. South Africans can now borrow – in USD – up to a 50% loan-to-value (LTV) against their BTC at a 12% annual interest rate.
It’s what TFOS calls the HODL (‘hold’) Strategy 2.0.
Initially, bitcoin holders were determined to accumulate BTC as a hedge against devaluating fiat currency. The problem this presented was that the BTC became something of a barren asset, earning little or no yield. The only real way to realise value was to later sell BTC at a higher price.
This strategy means you can now borrow USD against your bitcoin and use that to accumulate more BTC, to invest elsewhere or simply to spend.
The question investors should be asking is not ‘Where can I get the best rate?’ but ‘Where can I get a loan that survives an audit, an estate, and a bank query?’. Once that becomes the right question, TFOS believes it has the best answer for South Africans.
For years, the infrastructure for compliant bitcoin-backed lending in SA simply did not exist. That has changed dramatically in the last few months as SA was removed from the Financial Action Task Force grey list, and the recent publication of draft Capital Flow Management Regulations bringing crypto formally into the exchange control framework.
This, says TFOS, brings much-needed regulatory clarity to bitcoin-backed USD lending services in SA.
“Our product is a direct response to that opening. We are not working around the rules, we are operating because of them,” says Oleksandr Tsyhlin, executive director at TFOS.
Accessing USD liquidity without giving up bitcoin
The core of what TFOS offers is straightforward: clients pledge bitcoin as collateral, draw USD against it at up to 50% LTV with fixed 12% annual interest, and keep their position intact.
“When the loan is repaid, the bitcoin comes back unchanged,” says Tsyhlin.
“This solves a problem we see across our client base – diversifiers wanting exposure to global markets, families with offshore obligations, and non-resident holders with operational USD needs.
“In each case, selling would mean crystallising a tax event and giving up future upside. Borrowing preserves the position and meets the obligation.”
The real difference is jurisdiction, not the loan terms
Global platforms have polished interfaces and competitive rates.
What they cannot offer a South African-connected investor is legal recourse inside the SA framework.
TFOS is honest about this – it sees compliance and the friction this inevitably invites as both necessary, and an opportunity.
It is an authorised Financial Services Provider (FSP) and holds a Crypto Asset Service Provider (Casp) licence, placing it squarely under the jurisdiction of the multiple regulators, including the Financial Advisory and Intermediary Services (Fais) ombud.
Its reporting requirements are stringent, from Loan Reporting System (LRS) integrated loan registration, the international Crypto Asset Reporting Framework (Carf) and tax compliance status aligning with South African Revenue Service (Sars) requirements – to name a few.
Institutional custody is taken care of via Fireblocks, the gold standard for institutions.
“This comprehensive reporting and compliance structure creates friction, but we do not apologise for this,” says Tsyhlin.
“It is the reason our clients can survive an audit, an estate query, or a bank asking about the source of incoming USD. That is what we mean when we talk about legalising access to global liquidity.”
Two camps of bitcoin holders
Bitcoin holders divide into two camps:
- Those who sell when they need cash
- Those who borrow against it.
The first camp pays capital gains tax and gives up future upside.
The second camp keeps the position.
Until 2026, the second option did not exist for South African investors inside their own regulatory perimeter.
That has changed. A licensed South African intermediary now lets a holder pledge bitcoin as collateral, draw USD against it, and keep the position intact. When the loan is repaid, the BTC comes back unchanged. That is the product TFOS launched this year.
How the TFOS loans are structured
The bitcoin-backed loan structure is straightforward:
- USD loans secured by bitcoin collateral;
- Up to 50% loan-to-value;
- Fixed interest at 12% per annum, accrued daily;
- No minimum loan size, no minimum term, no penalty for early repayment; and
- Collateral is held in institutional custody via Fireblocks.
What happens when the BTC drops?
The margin discipline is intentionally conservative.
A client is not exposed to immediate liquidation on routine bitcoin volatility.
A margin event arises only if the BTC price falls roughly by half from the level at which the loan was issued.
At that point the client may either repay part of the principal or top up the collateral. If the BTC price rises, the position improves and additional liquidity becomes available on better terms.
“We give clients three things: transparency, legality, and control,” says Tsyhlin.
“Unlike global platforms, we operate within the South African jurisdiction. Your liquidation will not happen in the dark, and your incoming USD loan will be officially registered in the LRS system. We are not just turning bitcoin into dollars. We are legalising your access to global liquidity.”
For more information about the service and terms, contact the TFOS team at clients@tfos.com.
Brought to you by TFOS.
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