It is fiat debt, at a fiat debt interest rate
Discussion
I mean, aren't there better forms of collateral? Like a house?
I never got it either. People with decent credit can get unsecured loans at the rates half these places offer if you give them your keys.
Should I gamble with my credit score or my Bitcoin? If you lose your sats you don't magically get them back after 7 years of good behavior like if you trash your credit score.