Unpopular opinion: Collateralized loans will move BTC from retail to institutions, who will get even richer.

LTV of loans of 50% (or other %) make it so you can only ever get half (or a partial) of the BTC you loaned out back.

Meaning, many people plan on buying more BTC with the loan money, and while in theory it seems like it will work, it will just end up enriching institutions.

The reason is this: The only thing anyone does with your lent Bitcoin is sell/short it. That's it, there is no other use case for lenders wanting your BTC.

When loaning bitcoin you are essentially selling half of your coin into the market, putting downward pressure on it. Maybe some shorts gets rekt, and they pay the coin back, but gess what? The institutions loan out your coins to be sold again. As long as your coins are loaned, they are adding to sell pressure.

Why will institutions get richer? Because if even only a percentage of people have bought bitcoin with their collateral, and the price is able to be dropped, folks will be liquidating their bitcoin they bought with the loan to pay it back, adding to sell pressure already in the market. Sure some may have other sources of funds to top up the loan but this is an exception, rather than the rule.

If the price keeps dropping, this is where the institutions lick their lips as they watch our LTV dip below 50%. The loan is now under collateralized, either making us give them even more BTC to cover the gap, which they they then of course short, or we liquidate our BTC collateral to cover the loan, giving our coins to the institutions, one way or another.

Volatility needs to be much lower, and market cap needs to be much higher for this to work in our favor. But guess what? By the time this happens, institutions will be lending us bitcoin which we will hold dearly, because we hope it beats inflation and the loan interest rate. And by us I mean only those who can afford to post the collateral for bitcoin.

TLDR; They wont have to court you for your coins, you will give them up willingly for a fiat loan. Price drops will be engineered to call your loans. Much later they will loan BTC back to you, and then you will hodl it. Don't lend out your BTC, you will miss it.