This is indeed true and a huge red flag, however I'm not commenting on users choices... it is your money and you do what you want with it.

The purpose of my posts here is to make sure everyone understand that what he is offering is not collateral by definition.

It is some kind of 'deposit to escrow' which may or may not lose value. If its value rises he is safe since escrow holds the coins and he can redeem them by paying.
The breach happens in case the value lowers.... he is no longer financially compelled to uphold his part of the bargain since he will trade a good asset (plus interest) for a losing one. You'll have to believe his word for this.... which makes to whole concept of collateral null and void.

The fact that he did not mention partial redeeming is just inexperience, it is a common condition of loans when another currency is used as true collateral not this kind of weird hybridation that OBVIOUSLY favors him despite his weird attempts at denying this.

That being said if these conditions are enough for someone to gamble, go ahead! I'm not suggesting that he will not pay... he is just making false advertisement and claims.