Out of all the different crypto-related services that have popped up on the market in the past few years, cryptocurrency lending and borrowing have to be among the most popular ones. Crypto lending platforms have become a staple in the industry - more and more people choose them over traditional credit and lending institutions!
What’s the entire appeal surrounding crypto lending, though? How are the best crypto loan providers better than your traditional currency lending companies?
We’ll talk about all of that in this article! On top of that, I’ll tell you about 5 of the best crypto lending platforms in the current industry, both in regards to lending your assets, as well as taking out a loan, yourself. Our list will look a bit something like this:
Crypto Lending Platforms: Lending VS Borrowing
While crypto lending platforms are a popular concept, people actually look for these platforms for two very different reasons. The same is likely true with you, if you’re reading this article.
One group of individuals is going to want to lend their assets, and earn passive interest on them, while the other group will want to borrow crypto. While both groups of people have different goals, they are still both going to need the same crypto lending platforms, nonetheless.
Admittedly, most people who are googling “best crypto lending platforms” are actually looking for a place where they could lend out their assets. As mentioned above, you’d do that in order to earn a passive income, over a period of time. So, you’d lend your cryptocurrencies to someone else, with the platform acting as an escrow, of a sort.
Then, after the other person repaid their debt, you’d receive interest. Naturally, things are far more technical than that, but the general idea remains the same.
Now, the other group of people looking for the best crypto lending platforms are looking for a top-tier place to take out a loan, for themselves. In this regard, cryptocurrencies have become a method of borrowing money without the need to involve centralized banks and other credit issuers.
Think about it - perhaps you have a poor credit score? Maybe you’ve taken out a loan before, something went wrong, and now your score has suffered because of it? In many cases, traditional credit providers are very strict with their choices, in regards to whom will get a loan, and who will get denied.
On the flip side, crypto lending is a way to solve this, for many individuals out there.
When you take out the best crypto loan, all of the processes are going to happen with the help of smart contracts. This, in turn, means that there’s no room for human error, and there won’t be any foul play involved.
Granted that you put up collateral while taking out a loan, the loan provider can be assured that their assets will are protected, and that you will most likely pay the loan back - if not, you’ll lose your collateral. Note that crypto loans without collateral don’t really exist - anyone offering a service like this shouldn’t be trusted lightly!
Circling back to our list of the best crypto lending platforms, rest assured - here, you’ll find platforms that offer both the option for you to lend out your crypto assets, as well as borrowing features for those who want to take out a loan.
One last note, though - we won’t be discussing decentralized crypto lending projects. While they do often offer some very attractive APYs and other benefits, there are also certain risks associated with them, as well.
On top of that, those same APYs are also often very volatile - this creates a lot of uncertainty, and if the market one day experiences a worse day than usual, it could result in some unpredictable profit swings.
Instead, in this article, we will focus on established and mostly well-known crypto platforms - those that employ KYC verification checks in regards to their users, as well as offer industry-standard asset and identity security features.
Now that we’ve got that out of the way, let’s get to our list!
