Cryptocurrency brings a lot of advantages that come within the financial aspect of the digital economy such as it is more accessible to the masses, and it adds a new level of transparency and security to financial transactions that weren’t possible before. Thus, peer to peer (P2P) lending with Crypto is popular recently especially 2021 when the era 4.0 has been developing rapidly as it is combining the benefits of direct lending with the foolproof technology like blockchain will make lending, borrowing and saving money as simple, transparent and efficient as it should be. Let’s clarify what benefits you would have if you use peer to peer crypto lending service via this article!
Peer to peer lending and its history
Peer-to-peer lending, or as it was known in the past — social lending, has been in use since the 1700s by Jonathan Swift for swifting to lend small amounts of money and charged no interest.
Throughout the 18th and 19th centuries, peer-to-peer lending reached its peak and became one of the most widely used methods of lending in Europe. By the 1800s, more than 300 lending programmes were operating in Ireland, lending small amounts of money for short periods of time.
The peer to peer lending method also can apply in the Cryptocurrency field when it offers greater transparency, efficiency and scalability, and potentially, lower costs to all.
Do crypto assets benefit the P2P market?
The burst of blockchain technology has brought about a new era in the fintech industry. It is often seen as the invisible technology that’s changing the world, and especially, the digital life we lead online. Everything from travel insurance to banking to P2P lending is being rethought in the light of the emergence of this new technology.
Equality on a global scale
Global decentralised P2P platforms using blockchain technology will be able to offer the same terms regardless of citizenship or inflation.
Besides that, the global reach enabled by crypto lending offers a unique advantage to P2P investors. As they get the choice to lend to anyone, anywhere, the geographical diversification dramatically reduces the systemic risk, posed by local economic ups and downs. On top of that, lower operational costs mean higher returns for investors.
No one’s left behind
39% of the world’s population doesn’t have a bank account and one of the prime benefits of using cryptocurrencies is that it enables borrowers without a bank account or credit history to take out loans. That could never be possible within the traditional banking system. Blockchain-based P2P lending platforms can bring financial services to clients who have previously been barred from participating in the economy.
A useful platform for hectic world
The peer to peer crypto lending will be a great helper for users during the financial crisis or suddenly face the situation requiring money with a large amount. However, the users always can ransom their assets all the time after solving their personal problem with affordable interests.
How does Crypto lending work?
Normally, it works by connecting borrowers to lenders via an online platform. Instead of money, crypto lending trade on cryptocurrencies via a crypto lending platform. Lenders on crypto lending receive their interests once the borrower repays the loan. A lender makes its assets available to loan at a certain rate.
Users usually lend their cryptocurrencies for two main reasons: first, for personal use and second, for margin lending. With the later, once the lender’s funds are available, a borrower who believes a certain coin will increase in value will request to lend a part of the funds availed by the lender. Crypto lending can differ, depending on the platform, but what remains constant is the core concept.
Suggested crypto lending platforms
The below list comprises the leading platforms that offer cryptocurrency lending services. If you are thinking of trying out this type of lending, these platforms may provide you with the best starting options.
- King Bank
King Bank is a financial application that allows users to deposit and receive interest and borrow money as collateral with digital assets: The asset holder wants to deposit the asset on the exchange to receive interest periodically up to 6.5% annual percentage rate. While, borrowers pledge assets at a rate of X% to the floor, when the property price falls below the specified contract liquidation. King Bank accepted Cryptos such as BTC, USDT, ETH, BTCN with an interesting rate for users.
King Bank has now available on Google Play and Appstore. Download it now:
GG play: Here
Nexo is powered by Credissimo and offers a prospect to make quick crypto loans, allowing crypto-asset owners to sue their holdings as collateral, and then access loans in cash form. This way, crypto-asset holders can obtain cash while retaining the ownership of their crypto assets.
- SALT Lending
This platform offers Blockchain-backed loans with Bitcoin, Litecoin, Ethereum, and Dogecoin as collateral. SALT is a short form of (Secured Automated Lending Platform.
P2P cryptocurrency lending solutions are a welcome alternative rather than cash. They capture the spirit and utility for which bitcoin and altcoin designed and complement P2P exchanges to result in a trustless and permissionless financial system that is open to all. It is worthy for traders to experience P2P crypto lending platform from today.