It is no more news that the crypto lending sector has emerged as one of the top-performing industries in the crypto world. This success stems from its reliance on blockchain and crypto technology to offer banking services to the billions of people who are denied such opportunities.
Apart from that, crypto lending platforms are incorporating features and business models that make them more attractive than their traditional counterparts. For one, they offer competitive rates, unburden users of complex and expensive loan origination processes, and enable transparency via blockchain implementations.
However, as it is with every industry, there are a handful of crypto lending initiatives with innovative business models that have set them up for unprecedented growth.
To show you different approaches to the crypto lending and how these frameworks have helped top crypto lending solutions to build formidable products, I decided to highlight 10 platforms from the top echelon of the burgeoning coin-based lending market. Needless to say, the platforms listed below should popup on your radar whenever you are looking to adopt a crypto lending facility.
As for its rates, Blockfi sets a 4.5% loan rate with a 25% loan-to-value ratio. Lenders, on the other hand, have access to 8.6% interest rates on deposited funds. It is worth noting that Blockfi recently removed minimum deposits form its platform’s policy, which means that there no restrictions as regards the minimum amount users can deposit to start earning interests.
Besides, Nexo has partnered with BitGo to enable premium-grade custodian services for its users. For its loan rates, Nexo sets 11.9% as its official rates and 5.9% for Nexo token holders. Lenders are eligible to 8% interest rates on all deposits.
To access funds, a borrower only needs to make a request, and the platform will automatically match them with existing lending offers on the Squilla’s marketplace. Furthermore, lenders can distribute their capital to two or more borrowers to diversify risks and repayments. Besides, Squilla facilitates multi-sig cold wallet infrastructure, in addition to military-grade encryption, to ensure that its network is unsusceptible to attack. In terms of fees, there are no extra costs linked to the withdrawal and deposit of assets. Fixed Interest Rate helps borrowers to make the same payments over the entire term (no matter what market interest rates do), and with no early repayment fees.
Furthermore, Celsius Network prides itself on being one of the platforms with the lowest rates in the lending industry. The platform offers as low as 8.95% on loans and 4.95% for clients making repayments with the CEL token. On the other hand, Celsius Network provides 10% interest rates on digitals assets made available for borrowers. Having incorporated all these mouth-watering features, Celsius Network has, therefore, recorded unprecedented growth, as it has processed over $4 billion worth of loans since it launched its services.
Moreover, Bankera offers competitive loan rates, which could go as low as 6.95% for borrowers with a less risky LTV ratio. Regardless, Bankera processes loan requests with LTV as high as 75% – one of the highest in the nascent crypto lending market.
However, the platform charges fees on all fiat withdrawals, while native token holders are eligible for 50% discounts. Borrowers can access funds on loans with LTV up to 70%.
Nonetheless, the minimum loan amount is pegged at $5,000, and borrowing does not entail prepayment or origination fees. That said, the expected interest rates on assets lent to borrowers is 5.95%.
The interest rate of Dharma is 8.4% for lenders utilizing the DAI stablecoin and 4.1% for those depositing USDT. Another noteworthy feature is Dharma’s smart wallet.
Owing to Nuo’s p2p-based framework, it locks deposits in smart contracts, thereby relieving the platform of custodial responsibilities.
To protect its network from hacks, the solution has implemented a distributed access management system. Like Nexo, Lendabit has partnered with BItGo to enable insurance coverage for the assets deposited into its wallets.
Disclaimer: I do not have any vested interest in any of the mentioned projects. The views and opinions expressed are those of the author and is not investment advice. Do your research.