Top 3 Platforms for Crypto Loans

Bitfinex 

Bitfinex Borrow is a P2P platform that makes it possible for users to provide cryptocurrency assets as collateral in order to borrow funds from other users. Bitfinex acts as a facilitator, and in the process provides the technology that makes it possible for borrowers and lenders to transact with each other.  

Bitfinex Borrow ensures that borrowers and lenders can have the opportunity to experience the transparency that P2P affords along with an array of other benefits, including flexibility and high rewards. There are no limitations as to how much a borrower can use the funds they obtain through Bitfinex Borrow. A user also has the ability to set the duration of the loan and the interest terms that are most suited to their specific circumstances and requirements. Users are however required to go through the verification process in order to access the features of the Bitfinex Borrow service. The level of verification a user chooses determines the range of options made available to them on the platform. For instance, a user is required to be fully verified in order to borrow fiat currency. 

The amount that any user is able to borrow is subject to the type and the amount of collateral they provide with an overall limit of $250k. Users ought to utilise the loan calculator to discover exactly how much they can borrow as well as the minimum margin requirements that they must maintain.

Source: https://www.bitfinex.com/borrow

Fees

Borrowers are required to pay a loan creation charge that is equal to the maker fees that would apply if the loan transaction was an order on the exchange, plus interest. Lenders are required to pay a fee on the interest that they collect through lending in the P2P funding market. 

Interest that is charged for a variable rate loan is bound to change throughout the term of the loan. When users begin to borrow under a variable rate loan, Bitfinex Borrow automatically routes and executes one or more market order loan transactions on the user’s behalf in order to get the funds the user wishes to borrow from lenders in the financing order book. 

Constant 

Operated by CONST LLC, MyConstant allows users to lend BTC, ETH, and BNB while earning up to 4% APY, compounded and paid every second. The platform claims that users have the ability to make withdrawals of interest and their principal at any time. All the lending is said to be backed by MyConstant Guarantee which effectively defines a limit of investment within which MyConstant can protect invested funds from loss or theft while in the custody of third parties.

Users of MyConstant need to understand that their crypto assets fund liquidity in numerous decentralized exchanges and swapping platforms. They are able to earn interest when trades or swaps of crypto assets take place, as earn a portion of the trading fees. They also have partnerships for instance with Incognito, their primary exchange partner, with whom they made an agreement to pay 7% APR in their native privacy token, PRV. Users of Constant are also in a position to select to receive interest in the currency which they invested eg. BTC, ETH, or BNB but the rate offered is a little bit lower than when choosing to receive interest in PRV which makes sense since there’s a lot less liquidity for the token compared to the BTC, ETH or BNB. MyConstant does not charge fees, however, network and gas fees will still be charged by the user’s wallet or exchange. 

When users invest with Constant, they typically need to first send their funds (either fiat like USD or stablecoins) to MyConstant’s custodial partner Prime Trust, which is an accredited financial institution in the US. Once Prime Trust receives the funds, they then convert the user’s funds to a relevant stablecoin which Constant then lends on the user’s behalf to collateralized borrowers, liquidity pools, and decentralized exchanges in return for interest.

When a user is ready to make a withdrawal, Prime Trust then converts their invested stablecoins back to the relevant currency of their withdrawal request. The good thing is that there is no charge or fees for fiat USD withdrawals and users are able to keep the interest they earn up to the moment they withdraw their funds.

Users have the choice to choose either the instant access account or to invest for a fixed term. The instant access account actually has a 24-hour term that is automatically extended each 24 hours unless the user chooses to disable the product or withdraw their funds.

MyConstant makes it possible for users to borrow against their cryptocurrencies holding from just 6% APR. This enables investors to access the cash or crypto they need instantly without having to sell their portfolio. The user’s crypto is securely stored and then returned to them upon repayment of their crypto-backed loans.

YouHodler

YouHodler enables users to access cryptocurrency loans backed by the top 15 coins with up to 90% loan to value ratio (LTV). Users stand the chance to earn crypto with 12.3% APR + compounding interest by using YouHodler.

If a user wants to use their crypto as collateral in order to get instant cash loans and cryptocurrency loans in either EUR, USD, GBP, CHF, Tether (USDT), or Bitcoin (BTC) then YouHodler is an option because it claims to have the highest loan to value ratio (90%) with minimum loan amounts starting at just $100. YouHodler is also unique in that it accepts the top 20 coins as collateral according to indexes such as Coinmarketcap with instant credit card and bank withdrawals included in their offering. YouHodler does not charge fees for crypto deposits or withdrawals.

Users can simply use the crypto loan calculator to choose the appropriate loan plan of their choice. Loan approvals on YouHodler can take even just a few seconds to be processed. What’s great is that the user does not need to go searching for lenders as on most P2P platforms, they can simply receive instant cash in EUR, USD, USDT or BTC directly since YouHodler operates a pawnshop type business model where there is a temporary sale of crypto assets and where the user is the seller and YouHodler is the buyer. After a predefined period of time, users can repurchase the cryptocurrency from YouHodler.

The platform enables cash withdrawal options that include bank wire withdrawals via SEPA and SWIFT. They also allow credit card withdrawals to users’ MasterCard or VISA cards. Users can also repay their loan using a credit card, stablecoins or bank account. 

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