Home › Learn › Can I get a Bitcoin loan with no monthly payments? # Can I get a Bitcoin loan with no monthly payments? By Benjamin Whitby · Published 27 October 2026 · Updated 27 October 2026 ## The short answer Yes: Diamond Hands by GVNR loans have no monthly payments, and your UCD debt does not grow month by month. A 3% mint fee is added to your debt at mint: borrow 100 UCD, receive 100 UCD, owe 103 UCD. Repay any amount during the 12-month term, then repay the rest or renew. The loan can still be liquidated. ## Key facts - There are no monthly payments on a Diamond Hands loan. - The 3% mint fee is charged on the amount borrowed and added to your UCD debt at mint. It is not an APY or APR. - Your UCD debt only changes when you mint, repay or renew. Nothing is added to it month by month. - Each loan has a 12-month term. - You can repay any amount of UCD, in part or in full, during the term. There is no early-repayment penalty. - At the end of the term, you repay the loan or renew it for 12 months. Each annual renewal costs 3% of the outstanding debt, less a credit for the unused part of any mint fee paid during that term. - If you do neither, the liquidation threshold starts rising from the first day after expiry. - Diamond Hands is in Mainnet Beta, with a 100 UCD cap for now. The cap is expected to rise in the coming months. ## Why do many Bitcoin loans cost more the longer they run? Diamond Hands fixes what you owe for the 12-month term at the moment you mint: the amount you borrow plus the 3% mint fee. Renewing for another term adds 3% of the outstanding debt, so the cost scales with the number of years the loan runs. Many other Bitcoin loans charge interest instead, so what you owe depends on how long the loan runs and, with a variable rate, on where that rate goes. CoinMarketCap reported on 20 October 2026 that Bitcoin holders had borrowed a record $1.6 billion in stablecoins on Morpho's main Base market, the market behind Coinbase's Bitcoin-backed loans. It noted that "the cost of borrowing has also fallen over the past year, to about 5%", citing Delphi Digital, that Coinbase customers had more than $1.4 billion in variable-rate loans outstanding in September, and that Coinbase added fixed-rate loans "with the rate and repayment date set upfront" ([CoinMarketCap](https://coinmarketcap.com/academy/article/bitcoin-morpho-base-collateral-doubles)). With a variable rate, the cost moves while the loan is open. With a Diamond Hands loan, there is no rate to move. ## How much will I owe at the end of the term? On Diamond Hands, you owe the amount you borrowed plus the 3% mint fee, minus anything you have repaid. Your debt does not change unless you act. Worked example (illustrative): - **Mint UCD.** You borrow 100 UCD. You receive 100 UCD, and your debt is 103 UCD. - **Month 1 to month 12.** No payments fall due. Your debt stays at 103 UCD. - **If you repay 50 UCD part-way through.** Your debt falls to 53 UCD straight away. - **End of the term.** You repay the remaining debt, or renew the loan for another 12 months. Repaying early never costs extra. A UCD repayment burns that UCD on Ethereum and updates your debt and collateral ratio in the same transaction. You also choose how much to borrow. Loans open at a minimum collateral ratio of 150%, and the maximum LTV at opening is 66%. Borrowing less than the maximum leaves more room if the BTC price falls. ## What happens at the end of the 12-month term? A Diamond Hands loan gives you two choices at the end of the term: repay it, or renew it for 12 months. **To repay,** use Repay UCD to clear the debt in full. The most consistent way to get UCD for this is to Swap through the PSM. After a full repay the loan stays open with zero debt, and you can Withdraw BTC after 6 Bitcoin block confirmations. **To renew,** extend the loan for another 12 months. Renewal opens in the final 30 days of the term. Each annual renewal costs 3% of the outstanding debt, added to your UCD debt, so again nothing is paid out of your pocket on the day. If you minted UCD during the term that is ending, you get a credit for the unused part of those mint fees: the share that covers the days still left in the term. The credit can lower the renewal fee, but never below zero. A renewal has three conditions. The loan must not be liquidatable. The collateral ratio must stay above 110% after the renewal fee is added. And the total debt must stay within the protocol's maximum loan size. ## What if I don't repay or renew in time? On Diamond Hands, there is currently no grace period after expiry. If you neither repay nor renew by the end of the term, the liquidation threshold starts rising from the first day after expiry, and it keeps rising until the loan is renewed, repaid or liquidated. A loan that was safe the day before can become liquidatable without any change in the BTC price. You can still act after expiry. You can repay any amount of UCD, including once the loan has expired, and an expired loan can still be renewed as long as it has not been liquidated and meets the renewal conditions above. Acting before the term ends is simpler. ## What are the risks? Diamond Hands has no monthly payments, but the loan is still secured by your BTC, and the main risk is liquidation. If the collateral ratio falls below the liquidation threshold (110% during the term), the loan is liquidated in full and you lose all the BTC in the vault. Only specified liquidators can trigger it. No BTC is returned, even if the vault was worth more than the debt. Below a 150% collateral ratio, the loan shows a warning in the app. If you have given an email address, you can also get an email. Nothing else happens to the loan at that point. No monthly payments also means no monthly reminder. Note the end date of your term, because after expiry the liquidation threshold starts rising. Diamond Hands is still in Mainnet Beta, with a 100 UCD cap for now. The cap is expected to rise in the coming months. ## Frequently asked questions ### Do I have to make monthly payments on a Diamond Hands loan? No, Diamond Hands loans have no monthly payments. You repay what you owe by the end of the 12-month term, or renew the loan. ### Does my UCD debt grow while the loan is open? No, your UCD debt only changes when you mint, repay or renew. The 3% mint fee is added once, at mint, and nothing is added month by month. ### Is there a penalty for repaying a Diamond Hands loan early? No, Diamond Hands has no early-repayment penalty. You can repay any amount of UCD, in part or in full, during the term. ### How much does it cost to renew a Diamond Hands loan? Each annual renewal of a Diamond Hands loan costs 3% of the outstanding UCD debt, added to the debt. If you minted UCD during the term that is ending, the unused part of those mint fees is credited against the renewal fee. ### When can I renew? Diamond Hands opens renewal in the final 30 days of the term. An expired loan can also be renewed if it has not been liquidated, the collateral ratio stays above 110% after the renewal fee, and the total debt stays within the maximum loan size. ### What happens if I miss the end of the term? On Diamond Hands, the liquidation threshold starts rising from the first day after expiry, with currently no grace period. It keeps rising until you renew, repay or the loan is liquidated. ### How do I get my BTC back? Use Repay UCD to clear the Diamond Hands debt in full. The loan stays open with zero debt, and you can Withdraw BTC after 6 Bitcoin block confirmations. ### Is the 3% fee an interest rate? No, the Diamond Hands 3% mint fee is not an APY or APR. It is charged on the amount borrowed and added to your debt at mint, so you receive the full amount you borrow. ## Sources All checked 27 Oct 2026. 1. CoinMarketCap (Alex O'Donnell), "Bitcoin Holders Borrow a Record $1.6B on Morpho Without Selling", 20 Oct 2026: [coinmarketcap.com](https://coinmarketcap.com/academy/article/bitcoin-morpho-base-collateral-doubles). ## Related - [Is the 3% fee an APY?](https://diamondhands.credit/learn/is-the-3-percent-fee-an-apy/) - [How do I borrow against Bitcoin without selling it?](https://diamondhands.credit/learn/borrow-against-bitcoin-without-selling/) - [What happens to my Bitcoin loan if the Bitcoin price falls?](https://diamondhands.credit/learn/what-happens-if-bitcoin-price-falls/) - [Diamond Hands](https://diamondhands.credit) - [Open the Diamond Hands app](https://app.diamondhands.credit/) ## About the author ### Benjamin Whitby Protocol Lead, GVNR. [LinkedIn](https://www.linkedin.com/in/benjamin-whitby-compliance/) Benjamin Whitby discovered Bitcoin in 2013 and Ethereum in 2014, and has been building in crypto ever since. He has a background in capital markets and regulation and a degree in Physics from the University of Exeter. His focus is BTCFi, Bitcoin as collateral, BTC-backed stablecoins and how digital asset treasuries are reshaping credit. He's building at GVNR, home of Diamond Hands, where Bitcoin holders can borrow without giving up control of their UTXOs. Diamond Hands is a decentralised protocol. Borrowing involves risk, including liquidation of collateral. Carry projections are illustrative model outputs, not return guarantees. Nothing on this site constitutes financial advice. Tax treatment depends on your circumstances, so take your own independent tax advice.