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Avalon Finance Review 2026: Bitcoin Lending on 22 Chains

Avalon Finance, run by Avalon Labs, is a Bitcoin-focused lending protocol with on-chain markets and a CeDeFi credit line. Its marketing numbers are large, but DefiLlama shows a small current TVL of about $1.14M.

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By the DappsAtlas editorial team · Updated Nov 4, 2026

DappsAtlas score

6.8/10

Good

Visit Avalon Finance

Our verdict on Avalon Finance

6.8/10

Avalon Finance suits Bitcoin holders who want to lend or borrow against BTC without selling it, and institutions that want a fixed-rate credit line. Its strengths are the Bitcoin focus, multi-firm audits and wide chain coverage. The main caveat is the gap between the large cumulative figures on the homepage and the roughly $1.14M current TVL on DefiLlama, along with custodian and cross-chain risks. Check live market terms before depositing.

Score breakdown

How Avalon Finance scores

Security: 7.0/10
Ease of use: 6.5/10
Fees: n/a
Features: 7.5/10

Scores run from 0 to 10 and are based only on facts we could verify. Where information was missing we mark the score n/a rather than guess.

What is Avalon Finance?

Avalon Finance, operated by Avalon Labs, is a lending protocol built around Bitcoin. DefiLlama categorises it as Lending and describes it as powering Bitcoin's on-chain capital markets. It has been listed since April 2024 and has a token, AVL.

The homepage claims it is the number one Bitcoin on-chain lender, with $3.1B+ in total capital loaned, 300,000+ users and 20,000+ BTC serviced. These are the project's own figures and cumulative, not current balances. DefiLlama shows TVL of about $1.14M, down 6.0% over 7 days.

The product has three parts: on-chain markets, a CeDeFi credit line for institutions, and a Super Earn yield product shown as coming soon.

How Avalon Finance works

Avalon works like other lending markets. Users deposit assets, mainly BTC and BTC-linked tokens, into smart-contract pools and earn a supply rate. Borrowers post collateral and take loans against it. If the collateral value falls too far relative to the loan, it can be liquidated.

The on-chain product uses isolated markets, which means each asset pair is separated from others. The homepage says there are more than 50 such markets across 20+ chains.

The CeDeFi product is different. Institutions get a Bitcoin-backed credit line at a 7% fixed annual rate on a 6-month term, with BTC held by an independent regulated custodian. Avalon says it has no direct access to that collateral.

6 features

Key features

On-chain Bitcoin markets

Users supply and borrow BTC-linked assets in on-chain markets. The homepage cites 50+ isolated markets across multiple chains.

CeDeFi fixed-rate loans

A Bitcoin-backed credit line for institutions with a flat 7% annual rate on a 6-month fixed-term loan, with collateral held by an independent custodian.

Isolated markets

Isolated markets limit the spread of risk between assets, so trouble in one market does not directly affect others.

Wide multi-chain footprint

Deployed on 22 chains per DefiLlama, including Ethereum, BNB Chain, Arbitrum, Base, Bitlayer and Merlin.

Super Earn

A yield product for BTC holders with a stated 15% target APY. The page marks products as coming soon, so availability should be checked.

Multi-firm audits and monitoring

Code reviewed by Salus, SlowMist, BlockSec and Nethermind, with 24/7 on-chain monitoring described on the homepage.

Pros and cons

What we like

Clear focus on Bitcoin lending and BTC-linked assets.
Four named audit firms, with reports said to be public on GitHub.
Wide chain coverage, with 22 chains listed on DefiLlama.
A fixed 7% borrow rate for institutions, which is unusual in DeFi lending.
CeDeFi collateral is held by regulated third-party custodians, per the homepage.
Isolated markets limit risk contagion between assets.

Watch out for

DefiLlama lists TVL of about $1.14M, far below what the homepage's $3.1B+ cumulative loan figure might suggest, so current activity may be modest.
TVL fell 6.0% over the past 7 days.
The CeDeFi product relies on third-party custodians, which adds counterparty and operational risk absent from fully on-chain lending.
Spreading across 20+ chains adds bridge, wrapped-BTC and per-deployment risk.
Fee, liquidation penalty and collateral-factor details are not public, so costs can't be compared before using it.
The Super Earn product is shown as coming soon, and its target APY and risk profile are not visible.

Avalon Finance fees

Fees are not published. The homepage advertises a 7% fixed borrow rate for its CeDeFi credit line and a 15% target APY for Super Earn, but it does not describe origination fees, liquidation penalties or protocol fees.

On-chain markets show supply and borrow APYs per asset in the app, and network gas fees apply on each chain. Check the docs and the live market table for current costs before borrowing.

Is Avalon Finance safe?

The homepage says its code was reviewed by Salus, SlowMist, BlockSec and Nethermind, with reports on GitHub, and that it runs 24/7 on-chain monitoring. DefiLlama lists two audits. Audits do not guarantee safety, and none of this has been independently verified here. Public sources include no incident history.

On-chain lending carries smart-contract, oracle and liquidation risk, plus bridge and wrapped-asset risk for BTC on other chains. The CeDeFi product adds custodian and counterparty risk. Regulatory status is not described publicly. Only use funds you can afford to lose.

6 steps

How to get started with Avalon Finance

1
Read the official documentation to understand the on-chain markets and the CeDeFi product.
2
Check that DeFi lending and the relevant products are available in your jurisdiction.
3
Choose a chain and market, and review its supply APY, borrow APY and collateral terms.
4
Connect a compatible wallet through the Launch Dapp button and confirm you are on the official site.
5
Start with a small amount to learn how supply, borrow and repayment work, and watch your loan-to-value ratio.
6
Institutions interested in fixed-rate loans can apply for CeDeFi access through the site.

Open Avalon Finance

Who Avalon Finance is for

Avalon is aimed at Bitcoin holders who want yield or liquidity without selling, and at institutions seeking fixed-rate Bitcoin-backed loans. It suits users who are comfortable with DeFi lending, liquidation mechanics and multi-chain BTC assets, and who will read the documentation first.

Avalon Finance FAQs

What is Avalon Finance?

Avalon Finance is a lending protocol focused on Bitcoin. Users can lend, borrow and earn using BTC and BTC-linked assets through on-chain markets, with a separate CeDeFi product for institutions.

Which blockchains does Avalon Finance support?

DefiLlama lists 22 chains, including Ethereum, BNB Chain, Arbitrum, Base, Bitlayer, Merlin, Core, Sei, Scroll and others. The homepage says 20+ public chains and 50+ isolated markets.

Has Avalon Finance been audited?

The homepage lists audits by four firms: Salus, SlowMist, BlockSec and Nethermind, with reports said to be public on GitHub. DefiLlama lists two audits. Audits reduce but do not remove smart-contract risk.

What is the fixed borrow rate?

The homepage advertises a flat 7% annual fixed rate on a 6-month fixed-term loan for institutions through its CeDeFi product. On-chain market rates vary by asset and network and are shown live in the app.

Does Avalon Finance have a token?

Its token is AVL according to DefiLlama. The project does not describe its utility, supply or distribution, so check the official documentation.

Does Avalon hold my Bitcoin?

Not in the CeDeFi product. The homepage says institutional collateral is held by regulated third-party custodians and that Avalon has no direct access to client assets. On-chain markets use smart contracts instead.

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