Mar 13, · YouHodler is a FinTech platform focused on providing crypto-backed loans to end-users with fiat currencies (USD and EUR) and stablecoins etc. They have processed $10+ million in loans to customers around the globe. The most popular ones are BTC and stablecoin loans. The 5 Best Bitcoin Lending Sites #1 BLOCKFI. BlockFi was founded by Zac Prince and Flori Marquez. The first exchange that allowed individuals to buy #2 YouHodler. YouHodler is a relative newcomer, but it’s a strong competitor. APR stands for Annual Percentage Rate. #3 Coinloan. Coinloan.
Best platform to lend bitcoinBest Bitcoin Lending Sites For Bitcoin Loans
But despite their long term vision these investors also need liquidity for various other needs such as for vacation, repayment of a loan, or to buy a car, etc.
In such cases, if they sell their bitcoins, they will lose their competitive advantage of holding BTC for the long term!! Enter, Bitcoin loans to resolve this…. Moreover, Bitcoin and cryptocurrency lending of other digital currency will become more than obvious in the coming days because financial usecases such as lending, borrowing, insurance, savings accounts like the normal bank account, etc.
Lastly, you get BTC loans in your Bitcoin wallet which you control whereas in traditional lending you get your loan amount in your bank account which bank controls. But some would argue that there are things like crypto trading to make your investment grow from 1 BTC to 1. Yes, of course, there are, but not all are comfortable and used to trading crypto.
Everyone knows about lending, and the same concept of lending if applied to Bitcoin makes it as Bitcoin lending. Moreover, in this type of lending, you have your underlying Bitcoin as collateral. In simpler terms when someone lends their USD or EUR or stablecoins to a borrower on an agreed rate of interest for an agreed duration against their Bitcoin collateral, this is Bitcoin lending.
For the lenders also it quite easy as they need to decide to lock-up their funds for the agreed duration of lending as per the agreed rates. This enables them to earn extra interest on their capital that they were just holding previously. Moreover, there are no rigorous KYC checks or credit history inquiries that undergo before carrying on Bitcoin lending. But since Bitcoin is the pioneer cryptocurrency much of the crypto lending market exists around it.
Moreover, the custodial storage infrastructure is much robust and readily available for Bitcoin in comparison to other cryptocurrencies. Now, that you know how the Bitcoin lending cycle works, it is indeed imperative to understand the working of Bitcoin lending platforms which facilitate this lending. Almost, all Bitcoin lending services work similarly except a few processes that they might follow in-house. But if we generalize, here is a brief insight into their workings:. Of course, first, you need to register with the Bitcoin lending platform using your email.
Once your KYC is complete, tell them about your loan requirements and submit an application. Receive a loan decision within 24 hours including the LTV you are eligible for and the rate of interest you will be required to pay. Now, you can send your Bitcoin to their safe custodial solution.
Once the Bitcoins are settled on the blockchain, you will receive the promised loan amount in your bank account or stablecoins withing 90 minutes. Keep paying the interest-only payments monthly and pay the principal altogether in the end. This is how typically the lending process works inside a Bitcoin lending platform. For more example, see this short video of Nexo lending, where it explains the Bitcoin lending process in three simple steps:. For example, Nexo is offering 6.
When it comes to regulatory talks around Bitcoin, the situation becomes a bit tricky. As of now the regulation around Bitcoin is highly fractured and fragmented across the globe and for Bitcoin lending services it is no different. Many of the Bitcoin lending services are operating only in one or two jurisdictions where there is some regulatory clarity.
For example, BlockFi is operating in 45 states in the USA and is compliant with both the federal and state-level guidelines. Another big player in the Bitcoin lending space, i. For the rest companies also they are operating in their small arena untill the regulatory framework is set on a global scale.
So irrespective of whether you are looking forward to helping people or are interested in making some quick money, you can sign up as a lender on the website. Also, there is absolutely no limit placed on the amount of money you can invest. The way the entire process works is pretty simple. Anyone with a basic knowledge of Bitcoins can opt for either of the services offered on the platform. First and foremost, as mentioned before, a match is made between the lender and the borrower.
Once a perfect match has been found, then a contract is initiated. The contract clearly lists the amount or number of Bitcoins which are being lent to the borrower. The duration of the loan can be as less as six weeks and go up all the way to six years. Also, in order to make sure that there are no frauds happening on the system and there are no dishonest people involved, the website maintains a strict vigilance over all users.
The borrowers especially need to go through an identity check by providing basic identification details and even submitting a basic financial assessment. Once they are through with all of that, they are provided with a rating. This rating is the ultimate scale on which borrowers are judged while clearing them for loans.
The higher the rating, higher will be your chances of getting cleared for a loan. After the formalities are completed, the load request may take up to 14 days to fetch some real results. After the specified time duration is elapsed, and the loan is cleared, both the borrower and the lender receive a repayment schedule that is clearly displayed as per their convenience in their user account page on the website.
While all kinds of loans can be availed on this popular service, perhaps the most popular form of Bitcoin loan that happens to dominate all other transactions on this platform is the peer-to-peer loan service. An intuitive way of building the trust among customers for the service has been implemented by the website developers.
This great mechanism involves live chat among the different members of the website itself. This live chat box is present on the home page of the website itself and allows members to discuss several aspects of the platform itself such the risks associated with lending or borrowing, other specific members on the website or any other topic under the sun. To further ensure that the lender never feels insecure about the Bitcoins he is giving away and that the trust on the website never waivers, some loans on the website are also supported by a collateral, which makes sure that the lender always holds a guarantee against the loss of the principal amount.
If you have a Paypal account and a credit card, then we recommend you to opt for XCoins for bitcoin loans. The service specializes in helping their customers acquire Bitcoins through Paypal using their credit cards. While most other such services and platforms have shunned Paypal, XCoins actively embraces the platform and is thus great news for all those who prefer to channel all of their financial dealings through Paypal.
The process for obtaining the Bitcoins remains pretty simple and basic. All you need to do is sign up or register on the service, give away your identifications details and verify your identity, and deposit the US dollars equivalent of the Bitcoins you need to borrow. You might even be asked some to submit a nominal processing fee to so be prepared for that as well. Now the service is as open to lenders as it is to borrowers. If you feel that it would be in your best interest to lend some of your Bitcoins to borrowers in exchange for whatever fee the website has agreed upon, and are looking to make a quick buck, do sign up on this service.
The first step for lenders, however, begins with deciding the amount which they are ready to lend. This is an essential part of the process since based on this very information, matches will be made between the borrower and lender. As far as customer support is concerned, although XCoins does provide an option to contact the website administrators or support staff for resolving complaints, it could potentially take several days before a proper and effective response is received.
Another peer-to-peer lending platform which specializes in Bitcoins, the BitLendingClub has been in service for a few years now and has managed to build considerable trust for itself over the years.
They even boast of a low transaction fee but the most exciting and intriguing aspect of the website happens to be the fact that they feature a Dutch auction that gives a platform for the lenders to compete in. Borrowers can effectively go through a large number of lenders at one place through this auction and effective decisions on which lender to borrow Bitcoins from on the basis of their respective rates.
Also, the fee on this website is almost always pretty low and absolutely no lending fee is charged to the right until the point that a loan is being paid off. Poloniex is a pretty famous exchange service, one of the best Bitcoin lending sites and happens to be the undisputed leader among a great many cryptocurrency exchange websites or services out there. But it can also be tied to your crypto credit line. Salt is another popular crypto lending platform.
Salt offers its lending products in a very nice-looking app and design, perfectly tailored for the online generation. To take out a loan with Salt you can deposit many of the most popular cryptocurrencies as collateral. YouHolder is another interesting crypto loan company.
YouHolder has one of the widest available selection of cryptocurrencies supported on their lending platform. These can be used for collateral, repayments or for your loans.
Hardware wallets like Ledger and Trezor works perfectly to use in combination. Otherwise Unchained Capital works like the others on this list. They provide crypto loans Bitcoin.
With interest rates from 9. To CoinLoan is another cryptocurency backed loan platform. CoinLoan is tailoring for both the borrowers seeking funding and for the holders that want to increase their portfolios by providing the lending funds. For the latter category, you can earn interest rates up to And for the borrowers, they can get access to those funds by signing up for CoinLoan. Celsius Network is another blockchain-based crypto lending platform. Focusing on both giving holders a chance to earn some extra money from their coins and tokens.
And of course providing crypto-backed loans for the borrowers seeking funding. And interest rates ranging from 3. Which will give you a discount. Otherwise, you can also use Fiat currency USD, etc on their platform and then those rates go up to about 4. They burst onto the scene back in and has since seen a rocket-like rise to become one of the biggest cryptocurrency exchanges in the world. And they are actually now also a crypto lending platform, but we are including them on this list for their great savings rates.
Because the actual lending is not for typical loans but going out to fund the margin traders that operate on Binance. This might come as a surprise to some of you, but if you have followed Binance closely during then lending is just another branch of this growing crypto-tree.
They are already providing many other features that are sure to cement Binance as not only a leading cryptocurrency company but an integral financial institution. These operate like normal savings accounts. Where flexible lets you withdraw your cryptocurrencies at any time for a lower interest rate.
And the fixed will get you a higher rate but then you will need to lock down your cryptocurrencies for a longer time. Anywhere from 3 months to 1 year.