Arch Lending review

Arch Lending is a US-based crypto lender founded in 2023 and operated by ChainFi Inc, headquartered in New York. It has positioned itself as an institutional-grade alternative to the older CeFi lenders by pairing competitive, size-scaled rates with qualified custody through Anchorage Digital Bank — a federally chartered digital-asset bank — rather than holding collateral in-house.

The product is a fixed-term crypto-backed loan: you pledge BTC, ETH, SOL, or XRP and borrow USD or USDC at a rate that improves as your loan size grows, from an effective 10.49% APR on smaller loans down to roughly 7.25% APR for loans of $5M and above. Arch is NMLS licensed (#2637200) and operates in 44 US states.

Arch's pitch is custody safety plus pricing that rewards scale. Its trade-offs are an origination fee layered on top of interest, a conservative 60% maximum LTV, a short operating history, and the absence of any lending or earn product. It has grown quickly, raising a $70M financing facility in 2024, and runs aggressive 'switch to Arch' comparison pages against Figure, Lava, Ledn, SALT, Strike, and Unchained.

Borrowing from Arch is account-based and structured around qualified custody. First, register and complete KYC, since Arch is a regulated US lender. There is no credit check — approval is based on the crypto collateral you post, not your credit history.

Next, your collateral — BTC, ETH, SOL, or XRP — is held at Anchorage Digital Bank, a qualified custodian, rather than by Arch directly. This is the core structural difference from many rivals: your assets sit with a federally chartered custodian that does not rehypothecate them. You then draw a loan in USD or USDC up to a 60% loan-to-value ratio.

Your rate depends on how much you borrow. Smaller loans (under $250K) carry a 9.00% interest rate plus a 1.49% origination fee for an effective 10.49% APR, and the rate steps down through tiers as the loan grows, reaching roughly 7.25% APR for $5M+ custom loans. There are no prepayment penalties, so you can repay early to reclaim collateral, and Arch also offers structured products such as Tax Shield and Perpetual Income for specific borrower needs.

Arch prices loans on a sliding scale that rewards size, which is unusual among crypto lenders and is the heart of its value proposition. The headline range — an effective 7.25% to 10.49% APR — combines two components: a base interest rate and a one-time origination fee, and both fall as the loan grows.

On BTC collateral, a loan under $250K carries 9.00% interest plus a 1.49% origination fee (10.49% effective APR). From $250K–$750K it is 8.50% + 1.49% (9.99%); from $750K–$2M it is 8.00% + 0.99% (8.99%); from $2M–$5M it is 7.75% + 0.49% (8.24%); and at $5M+ rates start from 7.25% on custom terms. XRP collateral is priced materially higher (around 13.5% interest plus a 1.5% origination fee), reflecting its volatility and liquidity profile.

The practical takeaway is that Arch is most competitive for larger borrowers: a sub-$250K loan at 10.49% is roughly in line with SALT or Ledn, but a $2M+ loan in the low-8s or a $5M+ loan from 7.25% undercuts most of the CeFi field. Because the origination fee is one-time rather than annual, the effective APR also improves the longer you hold the loan. To minimize cost, borrow at the largest tier you genuinely need and factor the origination fee into your all-in calculation.

Arch's defining security feature is that it does not custody collateral itself. Instead, assets are held at Anchorage Digital Bank, a federally chartered digital-asset bank and qualified custodian, which does not rehypothecate (re-lend or reuse) the collateral. For a borrower, this materially reduces the counterparty risk that destroyed several in-house CeFi lenders in 2022 — your coins are not being lent out behind the scenes to fund the platform.

Arch is NMLS licensed (#2637200) and operates in 44 US states, and it raised a $70M financing facility in 2024 (arranged with Haynes Boone), which speaks to institutional backing. The main caveats are its short history — founded in 2023, it has not yet been tested across a full multi-year crypto cycle — and the absence of a formal public Proof-of-Reserves program, although the use of a qualified custodian is arguably a stronger structural guarantee than a periodic attestation.

The residual risks are the ordinary ones for a custodial-via-qualified-custodian model: liquidation if your collateral falls below maintenance LTV, reliance on Anchorage's continued operation and segregation, and the fact that Arch is not available in every US state. For a borrower prioritizing custody integrity, the Anchorage relationship is the single most reassuring element of the platform.

Arch is for US-based borrowers — particularly those taking larger loans — who want competitive rates and place a high premium on custody integrity. Its size-scaled pricing means it is especially attractive above the $250K mark and genuinely cheap at the multi-million-dollar level, where rates from 7.25% undercut most of the CeFi field. The Anchorage Digital Bank custody arrangement also makes it a natural fit for anyone whose primary concern is rehypothecation risk after the 2022 collapses.

It also suits holders of SOL or XRP, which few CeFi lenders accept as collateral. It is a weaker fit for very small borrowers (the origination fee weighs more heavily on small loans), for residents of the ~10 states where it is unavailable, for self-custody advocates who would prefer Unchained or Firefish, and for anyone who wants a lending or earn product, which Arch does not offer. Borrowers wanting the absolute highest LTV will also find the 60% cap conservative.

Arch Lending earns 8.0/10 as one of the strongest of the newer crypto lenders. Its combination of size-scaled rates (an effective 7.25–10.49% APR), qualified custody through Anchorage Digital Bank with no rehypothecation, support for SOL and XRP, and NMLS licensing in 44 states makes it a compelling, custody-safe choice — especially for larger US borrowers. The trade-offs are a one-time origination fee that weighs on small loans, a conservative 60% max LTV, limited state availability, a short track record since 2023, and no earn product. For a US borrower with a six- or seven-figure loan who cares most about custody integrity and a rate that improves with scale, Arch is a top-tier option; small borrowers and self-custody purists may do better elsewhere.