Ethereum treasury firm BTCS sold ether at a loss to keep $64 million Aave loan healthy - CoinDesk
Nasdaq-listed BTCS has sold ether below its purchase price to help protect a roughly $64 million Aave loan from automatic liquidation.
The company disclosed in a quarterly filing Thursday that it owed about $64.1 million on Aave as of November 9, including accrued interest. The debt was backed by 46,676 ETH worth $99.3 million at BTCS's stated ether price of $2,127, providing collateral worth approximately 155% of what it owed.
Sales of ETH were executed at prices below their original cost basis as part of the Company's active management of collateral levels and health factors associated with DeFi borrowing arrangements.
Liquidation Risk
Aave's protocol automatically scores each loan with a 'health factor' that compares collateral against debt. If the score drops below 1, the protocol can sell collateral to pay down the loan. As of November 9, BTCS's loan had a health factor of roughly 1.24, with liquidation possible near $1,717 per ether—about 12% below Friday's trading price of $1,950.
Limited Cash Buffer
The company had only $463,000 in cash at the end of September, with a 'significant majority' of its digital assets deployed as collateral on Aave, leaving those coins locked while the debt remains outstanding. This limited cash buffer increases pressure on BTCS to manage its collateral carefully.
Rapid Debt Growth
BTCS's borrowing has grown significantly, from just $320,000 in April 2025 to the current $64 million. Since the start of 2025, the company has borrowed about $152.4 million in stablecoins, mainly Tether's USDT and Aave's GHO, while repaying about $89.4 million. The board allows new borrowing up to a 50% loan-to-value ratio.
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