You can now borrow USDC against your Bitcoin on Mezo. Here’s how.

Before you start

When USDC is on Mezo, it is represented in the app as mUSDC. 1 USDC = 1 mUSDC.To borrow USDC on Mezo, you need a wallet connected to Mezo and BTC for collateral and gas.

Step 1: Open the Mezo app and choose mUSDC

Go to the Mezo app and connect your wallet.

Once your wallet is connected, open the Borrow page. This is where you can see your active loans, available collateral, current rates, and borrowing options.

Select mUSDC as the currency you want to borrow.

Step 2: Set your collateral and borrow amount

Choose how much BTC you want to use as collateral, then enter the amount of USDC you want to borrow.

Your collateral determines how much you can borrow.  Your position’s projected loan-to-value (LTV) ratio will update as you adjust your collateral and borrow amount. LTV is the value of your debt relative to your collateral. A higher LTV means a higher risk of liquidation. The more BTC you add, the more room your position has if the BTC price moves down.

If you have borrowed MUSD before, you may be familiar with the term collateralization ratio, or CR. LTV and CR are inversely related measurements: an LTV of 50% corresponds to a CR of 200%. Mezo now shows LTV across its borrowing products, so the number reads the same whether you hold MUSD or mUSDC positions. The position above is equivalent to a 323% collateral ratio.

Importantly, borrowers should pay attention to the market's Liquidation LTV. A borrower’s position will be liquidated if the LTV crosses the market’s Liquidation LTV. The gap between your LTV and the Liquidation LTV is your buffer, or how much your LTV can rise before liquidation. LTV rises when BTC falls, so the buffer measures how hard a drawdown your position can absorb. In this example case, the mUSDC market's Liquidation LTV is 86%. In our example of an LTV of 31%, BTC can fall roughly 64% before the position is at risk.

Finally, mUSDC uses a variable APR that moves with demand in the mUSDC market.

Step 3: Review and confirm

Before you sign, review the full transaction screen. Check the borrowed amount, collateral amount, projected LTV, liquidation price, and your projected position health. Then, confirm the transaction in your wallet.

The app may show a pending state while the position is being created. When the transaction confirms, your mUSDC borrow position appears in your Overview dashboard and is ready to be spent.

Step 4: Manage your position

After you borrow, your position appears on the Borrow dashboard. From there, you can track how much mUSDC you owe, how much BTC is locked as collateral, your current LTV, your liquidation price, your current APR, and your recent activity.

Step 5: Closing out your loan

Repay your mUSDC. Once the loan is repaid, your collateral becomes available again, and your closed position appears in your borrow history.

USDC Lending Vault

The USDC Lending Vault gives investors direct exposure to transparent BTC-backed credit.

Every mUSDC loan on Mezo is funded by capital supplied through the USDC Lending Vault. Depositors provide mUSDC to the vault, which allocates that liquidity to borrowers using BTC as collateral. Interest paid by borrowers accrues to the vault and forms the underlying source of depositor yield.

Loans are overcollateralized by BTC, and collateral balances, outstanding debt, interest rates, and position health are recorded on-chain. Deposited assets are not rehypothecated. The return earned by the vault can be traced directly to interest paid by borrowers.

There is no minimum deposit and no protocol fee to enter or exit the vault. Withdrawals may be requested at any time, subject to the amount of liquidity not currently deployed across active loans. As utilization rises, withdrawal liquidity may decline until borrowers repay debt or new capital enters the vault. Depositors may also stake their vault shares in the associated gauge to receive MEZO emissions (set to begin 07/14/26).

For more on how the vault works, check out the Mezo Docs.

FAQs

What happens if your position is liquidated?

Liquidation can happen if your LTV crosses the market's Liquidation LTV, whether because BTC fell or because accrued interest grew your debt.

For mUSDC, liquidation means another party can repay the debt and receive collateral from the position, and a 4% liquidation penalty comes out of your collateral. This protects the lending market, but it costs you real BTC.

The best way to reduce liquidation risk is to borrow conservatively and monitor your position.

LTV vs. collateralization ratio

If you borrowed MUSD before this update, you managed your position using the collateralization ratio, or CR. LTV and CR measure the same risk from opposite directions. LTV divides your debt by your collateral value. CR divides your collateral value by your debt. One is the inverse of the other: an LTV of 50% is a CR of 200%, and the 31% LTV in this guide's example is a CR of about 323%.

The thresholds convert the same way. The mUSDC market's 86% Liquidation LTV is a CR of about 116%. MUSD's 90% Liquidation LTV is a CR of about 111%. The Mezo app now shows LTV across its borrowing products, so one number reads the same everywhere.

Additionally, MUSD has a redemption mechanism that helps hold its $1 peg, which means an MUSD position can be redeemed against even while healthy. mUSDC has no redemption mechanism and only uses LTV.

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Start Borrowing with Mezo today.

Disclaimer: This post may contain forward-looking statements regarding protocol features, rates, yields, and product availability, and actual outcomes may differ materially. The information provided in this post is for general informational purposes only. It does not constitute legal advice, investment advice, or any other type of advice. Please consult with a qualified professional. Rates on mUSDC loans are variable and move with demand in the mUSDC lending market. The rate shown at origination reflects market conditions at that time and will change over the life of the loan. Mezo does not guarantee the availability of any specific rate. Deposits to the USDC Lending Vault are not bank deposits and are not insured or guaranteed by any government agency or by Mezo. Vault yield is variable, depends on borrower demand and interest payments, and is not guaranteed. Withdrawals depend on available liquidity in the vault and may be delayed when utilization is high. Borrowing and depositing involve risk, including liquidation of collateral and loss of deposited assets due to smart contract or protocol failure. Nothing in this post constitutes an offer to sell or a solicitation to buy securities. We recommend you speak with your own legal, financial, and tax advisors before participating in any Mezo product.