Passing the estimate of 100 million users, “cryptocurrency” is something you would have heard even if you don’t how exactly it works. The recognition that crypto has gained in a short period of time is indeed enormous, and many people are using it in many ways, from buying goods and services to protecting your assets in the form of digital currency. Another upshot that we have in DeFi is crypto lending.
Crypto Lending refers to the loan that works using cryptocurrency rather than traditional means of banking or using gold and property as collateral. Even though if you are a crypto investor, you must know that crypto coins are to be kept in a wallet and then sold when prices rise. However, these coins can also be used as collateral and are given back after loan payment along with interest.
This article will help you guide through all that you need to know about Crypto-Lending.
When did Crypto Lending Start?
Right after the COVID pandemic hit the face of the globe, there was a devastating effect on the economy worldwide. Lending and getting loans became harder, which made people think of some alternative. Crypto Lending proved to be an easy and well-founded solution that allowed many people to get the desired amount of loans using their crypto coins without the need of selling them for cash.
Points you Must Know about Crypto Lending
Before you think of getting benefit from one of decentralized finance industry products – crypto lending, it is important to know some of the tips so that you can get the maximum benefit out of it along with the safety of your asset.
- It is significant to understand that you should use no other means but coins as collateral during this entire process.
- For the sake of the security of your coins, make sure that no person other you know about your security keys.
- It will be a good idea to always borrow from low-rate platforms.
- Make sure that you review the interest policies of the platform you are borrowing from.
- Work with well-recognized and trustworthy decentralized platforms.
- Check upon the price changes constantly and sell your coins once they reach the highest, after clearing your loan as soon as possible.
Advantages of Crypto Lending: Why one should consider it
Crypto lending, unlike traditional means of loan, can be the easiest and simplest procedure to follow. Some of the leading points to note about this product are;
- The process is really quick, can be extremely helpful during any emergency circumstances.
- Plain sailing process unlike the procedure followed by banks.
- No background or financial statuses are checked
- You’ll still have the coins which can benefit you in the future by reaching their peak.
However, one should not forget the terms and conditions associated with this process, specifically related to interest. If you aren’t able to pay the loan back, you can lose your wallet coins forever.
So if you are someone looking to access the loan, what’s the wait for? Crypto Lending process is made super easy for you without any hectic of submitting documents and filling forms.