Financial services firm Two Prime has set a new record during the third quarter of 2025, reaching $827 million in Bitcoin-backed loans. This milestone, officially announced by the company, strengthens its position in the institutional credit sector. Furthermore, it provides crucial liquidity for corporate treasuries and funds that use BTC as a reserve asset.
Two Prime applies traditional financial regulations to its innovative crypto credit products. With this record figure, the firm raises its total originated loans to over $2.55 billion since March 2024. This growth demonstrates a sustained and increasing demand in the niche of digital asset-based financial services. The company has also stated that it has a credit line available exceeding $3 billion, signaling its capacity to handle large-scale operations.
An Expanding Market: How Do These Loans Work?
Two Prime’s business model is specifically designed for institutions that hold Bitcoin. According to a Galaxy Research report, the firm already controlled 6.54% of the CeFi market in the first quarter of 2025. One of the most attractive terms is that its loans are offered with a 0% original issue discount (OID), eliminating a common cost for borrowers. Additionally, the firm guarantees its clients that the deposited collateral will never be rehypothecated, meaning it will not be reused for other purposes.
To mitigate counterparty risk, a critical factor in the crypto ecosystem, asset custody is kept segregated. These funds are held in regulated entities such as Fidelity, Anchorage, and Bitgo. To educate the market, Two Prime distributes a practical playbook explaining how companies can manage their liquidity using these loans instead of selling their BTC holdings, thereby maintaining their exposure to the asset.
Clear Signals for Institutional Bitcoin Adoption
This volume of transactions sends important signals to the financial market. The strong demand for Bitcoin-backed loans reveals a growing interest from institutions in obtaining liquidity without having to divest from their digital assets. This is particularly relevant for corporate treasuries that have integrated Bitcoin into their long-term reserve strategy. Two Prime’s ability to originate billions of dollars solidifies its role as an institutional-scale liquidity provider.
Recent deals, such as the $200 million loan to KindlyMD and the $100 million loan to Flowdesk, validate its business model. Likewise, a strategic $20 million investment led by Marathon Digital Holdings underscores industry confidence. Although market risks persist, the prohibition on rehypothecation reduces systemic contagion, a key advancement for the ecosystem’s security.
The firm’s performance in the third quarter consolidates its position as a key player in digital finance. Looking ahead, the market will closely watch the quarterly progress in originating new Bitcoin-backed loans. The company’s ability to maintain institutional trust through secure practices, like segregated custody, will be crucial for its expansion and the overall maturity of the crypto lending sector.
