Five Best Crypto Lending Platforms for 2021
Crypto lending platforms, or blockchain-based credit infrastructures, are a new form of finance that is gaining traction in the cryptocurrency sphere. These platforms offer their users the ability to borrow fiat money against their cryptocurrency holdings. Crypto lending can be a great alternative for those who have crypto-assets but no access to traditional banking services. In this article, we have compiled five crypto lending platforms that have proven themselves effective over time and will continue to do so into the future.
Read on to find out…
Key factors to consider before selecting a crypto lending platform: interest rate, cost, platform risk, loan duration, collateral amount, and minimum deposit limit. Let’s go through the list of the best five crypto lending platforms.
The official Celsius homepage welcomes you with this note: “Celsius is a community of over one million users that earn up to a 17% yield on their crypto.” You can tell that one, it is a community, and two, the users earn a 17% yield on their crypto, and honestly, that is enticing because it is way more than traditional banks will give you for saving your fiat. Let’s take a look at other key factors: You are eligible to borrow a minimum of $5000 (USD) or $100 stable coin (USDC) at an interest rate of approximately 4% and 1%, respectively, at a 25% LTV (Loan-to-value ratio).
The Celsius team prioritizes security and has six security certifications, including ISO/IEC and 365/24/7 network monitoring. It also makes use of unique technologies such as multi-party computation to provide top-tier security and asset protection. The loan term is from a year to three years and the collateral amount, using the above-stated example of 5000 USD and $100 USDC, is 0.4115 and 0.0082 Bitcoin, respectively. These numbers are susceptible to future changes, and the loans are not available in all countries yet.
Unlike Celsius, which is centralized, Compound is a decentralized, blockchain-based protocol offering a great deal of anonymity that allows you to lend and borrow crypto as well as participate in its governance with its native “COMP” token. Since Compound is decentralized and cannot do a personal finance background check to determine the credit rating of the borrower, they only offer over-collateralized loans.
Compound operates on a floating market interest rate that effectively rules out any possibility of a bank run. The interest rate is determined by the supply-demand ratio in crypto markets, making your crypto investment balance safe, but this could be a problem for borrowers. The compounding period is small and can be
as small as 15 seconds, which is approximately the time it takes to mine a single Ethereum block.
Binance is confirmed as an A-list cryptocurrency exchange offering more services than regular crypto exchanges. Borrowing on Binance is easy. You can use your crypto as collateral to get a loan without credit checks. As long as you are a registered user of Binance, you can borrow anywhere from 100 USDC to 44,000 USDC with a loan term of 7 to 180 days. For 100 USDC, the collateral amount is 0.29089885 BNB.
Assuming the loan term is 7 days, daily interest would be 0.0600%, which would amount to 0.42 USDC at an initial LTV of 65%, margin call of 75%, and liquidation LTV of 83%. If the LTV of your loan is higher than the margin call LTV, you will be informed to either add more collateral or repay your loan. If the LTV becomes higher than the liquidation LTV, your collateral will be liquidated to repay your loan.
Alchemix enables users to obtain under-collateralized loans on their Ethereum or Dai tokens, which are then used to generate the astounding yields available in decentralized finance (DeFi). With Alchemix, there is no risk of liquidation, no interest is charged on borrowing, and the yield from your collateral pays off the debt for you over a number of years. The platform is governed by the ALCX token and has a market capitalization of US $413 million.
With $16 billion in TVL (Total Value Locked), Aave is the largest Defi borrowing and lending protocol on Ethereum. It currently supports 17 cryptocurrencies and generates an aToken for each of them. aTokens are a type of interest-bearing token that is pegged 1:1 to the underlying crypto asset’s value. aTokens are minted upon deposit and burned when redeemed. The AAVE token, which also serves as a governance token, powers the protocol.
The crypto lending industry is growing and has a lot of potential for growth in the next few years. As more people become interested in investing, platforms that offer crypto loans will be highly sought after in the coming years.
Did you know that your idle Bitcoins in your wallet could generate passive income? Let’s look at some of the best platforms where you can lend bitcoin and other cryptocurrencies.
Currently, crypto is the biggest buzzword in the market, and people are desperate to try to make a profit in the world of cryptocurrencies.
Several people believe that cryptocurrencies are similar to stocks and only limited to that. But in reality, there is much more to know about cryptocurrencies and blockchain.
One of the most common ways to invest in cryptocurrencies is to buy them and hold them until the price of the asset rises. But is it the only way to earn something in the cryptocurrency market? Well, the answer is no. If you dig deeper, many people will talk about cryptocurrency loans and making interest. Yes, you can get high-interest rates for the amount invested in different cryptocurrencies!
It sounds like a fantastic deal, right?
The lending concept remains the same as the traditional one, but the only difference is that an investor lends cryptocurrency on some platform instead of fiat currency. Borrowers take crypto loans from different platforms for trading or any other purpose. Investors earn crypto dividends in exchange for the amount they lend to borrowers on any decentralized platform.
You can go through the cryptocurrency loans and loans article to understand the concept in detail.
We will now consider the factors to consider when choosing a platform to lend cryptocurrencies.
How to choose a cryptocurrency lending platform?
It would help if you considered several factors when selecting any lending platform. Some of the critical factors to consider are:
- Interest Rates – Choose a platform based on the interest rate of that particular currency on any specific forum.
- Platform Risks – Please review the forum’s history for a better understanding.
- Fees – Compare the costs of different platforms for different currencies.
- Deposit Limit – Check whether there is any minimum deposit amount requirement or not.
- Duration of the loan: check if it is fixed or not.
- Collateral – Compare the amount of collateral you need to obtain a specific loan amount between different platforms.
The most crucial point is that you need to select the right platform for a particular coin. For example, if you see that Binance offers better returns for lending Bitcoin, you should consider Binance for bitcoin.
You do not need to lend all other cryptocurrencies on the same platform. You should research other media to find out where you can get better returns for your chosen cryptocurrency.
On the other hand, borrowers should compare different platforms to see where they can get a crypto loan at the lowest interest rate for their crypto assets.
Now, let’s look at some of the best crypto lending platforms.
When it comes to crypto loans, there is the simplest and fastest solution: RabbitCoin. The simple interface and a KYC-free approach (you only need your email or phone number to create an account) make CoinRabbit the best choice for beginners and experts who value their time.
Despite the simplicity of use, CoinRabbit pays a lot of attention to the safety of customer funds. Multiple security checks and AML are always carried out. After receiving the funds, they are separately withdrawn to the cold wallet system. Plus, you can always protect your account with the added 2FA protection.
The APR is only 1.2% per month and is complemented by completely free withdrawals available at any time and unlimited terms for your loans: partially or fully repay when you feel the time has come. Also, CoinRabbit provides the system to decrease your settlement price as flexibly as possible.
Five Best Crypto Lending Platforms for 2022
For those who want to make a decent passive income, CoinRabbit makes the process quick and easy. The 10% fixed APY with no additional strings attached is the highest in the entire market. Interest is paid daily, and you choose when to withdraw your earnings.
Even though the service is still very young, it is rapidly gaining momentum. It has already established itself in the community of many cryptocurrencies and closely cooperates with prominent market players such as ChangeNOW, Guarda Wallet, Atomic Wallet, etc.
Visit CurrencyRabbit to explore all the advantages offered by this platform.
Block is the one-stop solution to buy, sell and earn cryptocurrencies. You can expect up to 8.5% APY on different cryptocurrencies, where you will be paid monthly. There are no hidden fees or minimum balance requirements to worry about. You can store all your crypto assets in one place and also make them earn more for you.
If you need urgent cash, you can borrow funds from Blockfi by staking your crypto assets. You can borrow money at 4.5% APR. It is a reasonably straightforward process to open an account on Block, where you need to enter a few details, and you are good to go.
The best thing about Block is that it is an ideal option for people of all levels. If you are a beginner, you can expect comprehensive information on cryptography from service administrators. On the other hand, if you are an expert, you can get support for your queries. Block’s security system is top-notch to protect your crypto assets.
Celsius is a big name when it comes to lending and borrowing cryptocurrencies. You can earn up to a 17% return when you lend crypto on the Celsius network. You do not have to pay any fees, whether borrowing, lending or transferring the coins. Another great thing is finding Celsius in both web and app formats.
You can expect up to 17% APY (Annual Percentage Yield) to be paid to you every week. No matter what crypto you are lending on the platform, you will see great rates. On top of that, if you choose to earn in CEL token (exclusive to the Celsius portal), you can expect 25% more rewards.
When you visit the Celsius website, you can find a calculator to see how much you can earn based on the crypto you select and the duration you insert. If you need emergency funds, you cannot sell your crypto because you can stake it as collateral and borrow funds from Celsius for interest as low as 1% APR (Annual Percentage Rate).
AAVE is a relatively famous decentralized liquidity protocol. It is a non-custodial protocol where you can earn interest on your crypto deposits and borrow funds by staking your assets. AAVE is a well-developed liquidity protocol with many features other than lending and borrowing crypto assets.
When you move around the platform, you will see that it allows users to deposit or borrow assets. Interest rates are also clearly mentioned to make it easy to compare deposit and loan rates on different platforms.
There are different concepts involved in the AAVE Protocol, such as Bug Bounty and Flash Loans. If you see any bugs and report them to the developers, you can even get up to $250,000 from the developer community in USDC tokens. So this is worth exploring!
The Compound is another big name in crypto lending and borrowing protocols. There are many cryptocurrencies listed in the protocol, and you can deposit or borrow any of them. The Compound also has its COMP token to generate better returns while lending your crypto to the platform to provide liquidity.
The protocol’s security is top-notch, so that you can trust it for your assets. There is a live price feed on Compound to easily track prices on the platform based on liquidity availability. You can deposit or withdraw assets from your account every 24 hours.
Aside from that, Compound is also creating many products, services, and tools for the decentralized finance (Defi) ecosystem. You can even integrate different interfaces with the composite protocol.
MakerDAO has created its cryptocurrency called “Dai”. It can be used by anyone, anytime, anywhere. As soon as you open a vault on Maker, you can deposit up to 25+ crypto assets as collateral. You have two options after putting up your crypto asset as collateral. You can borrow Dai and hold it or purchase additional collateral to increase your exposure.
The Maker community has successfully built an entire ecosystem with Dai consisting of various apps and services. You can find the right app to get, use, hold, and even accept Dai in the ecosystem. Apart from that, there are many games on the Maker protocol, among which Sandbox has gained massive attention.
Once you connect your crypto wallet to Maker, you’re ready to go. Now, you can deposit, borrow, or even sell your crypto from the platform.
Using YouHodler, you can get a cryptocurrency loan in any of the top 15 coins with up to 90% loan-to-value (LTV). You can use YouHodler to store, exchange and even pay anyone through crypto-assets. You can get instant cash by putting your crypto as collateral. The best thing is getting a loan in Bitcoin (BTC), Tether (USDT), USD, EUR, CHF or GBP.
On top of that, you can get a loan even for $100. You can exchange your assets differently with the universal conversion on YouHodler. By simply depositing your crypto on YouHodler, you can earn up to 12% interest on various cryptocurrencies and stable coins.
Another fascinating feature is the Multi HODL function. It is an efficient tool that will help you multiply your favourite cryptocurrencies where you have to make small bets, and relatively high investment rewards are provided.
CoinLoan is another trusted platform available on Android and iOS to manage all your digital assets. There are no deposit and withdrawal fees to worry about. In addition to that, you can also enjoy daily interest by simply placing your purchases on the platform.
You can borrow cash in exchange for your crypto assets by staking them as collateral. The official website mentions all the supported crypto-assets and their fees. Apart from that, you can make it happen with just a few clicks, whether you want to buy, sell, or trade your crypto.
With CoinLoan, you can expect complete security of all your assets. Biometric authentication is provided in applications to enhance the safety of all your digital assets.
On MoneyToken, you can manage all your crypto assets and receive crypto-backed loans in a few clicks. The process is quite simple and only requires a few clicks. By selecting the loan terms and depositing the guarantee, you will only have to wait until your application is accepted and you receive your funds in the account.
MoneyToken is a decentralized platform where you have complete control of your assets that are at stake. You will receive an instant loan from here. Even if you want to lend your assets in MoneyToken, you can start by lending 100 USD or any crypto of the same value to the platform.
Binance is the world’s leading cryptocurrency exchange, with over 1,400,000 transactions every second. In addition to being the leading cryptocurrency exchange, Binance has built its ecosystem. Binance has also launched a coin called “BNB”.
Binance ‘s primary goal is to increase decentralized finance around the world. Currently, many service providers are building their blockchain applications on the Binance ecosystem.
You can say that Binance is a one-stop solution for everything in the blockchain world. Whether you want to buy, sell, trade or exchange your crypto asset or even borrow or lend your crypto asset, you can do it from here. You can even become a liquidity provider on Binance for much better rewards. In addition to that, Binance has also built its NFT marketplace to develop a place where creators can auction off their NFTs.
Binance is much more than a lending and lending platform. You can perform any blockchain-related task in the Binance ecosystem.
If you are in the world of cryptocurrencies, you should consider the option of lending. You can earn high interest on your crypto assets by lending them to different platforms. You need to stake them and provide liquidity on various platforms instead of just keeping them in your wallets. It is the best way to earn passive income.
Five Best Crypto Lending Platforms for 2021