Although peer-to-peer lending is a revolutionary method of saving, borrowing, and investing money, it is about to face significant disruption in the form of cryptocurrency providers. Cryptocurrency enthusiasts agree that the implementation of blockchain technology will greatly benefit the practice of direct lending, and it is further hypothesized that using Bitcoin or Ether for P2P lending would increase the practice’s scalability, transparency, efficiency, and cost-effectiveness.
Throughout the 18th and 19th centuries, peer-to-peer lending reached its peak and became one of the most widely used methods of lending in Europe. By the 1800s, more than 300 lending programmes were operating in Ireland, lending small amounts of money for short periods of time.
The peer to peer lending method also can apply in the Cryptocurrency field when it offers greater transparency, efficiency and scalability, and potentially, lower costs to all.
Do crypto assets benefit the P2P market?
The burst of blockchain technology has brought about a new era in the fintech industry. It is often seen as the invisible technology that’s changing the world, and especially, the digital life we lead online. Everything from travel insurance to banking to P2P lending is being rethought in the light of the emergence of this new technology.
Equality on a global scale
Global decentralised P2P platforms using blockchain technology will be able to offer the same terms regardless of citizenship or inflation.
Besides that, the global reach enabled by crypto lending offers a unique advantage to P2P investors. As they get the choice to lend to anyone, anywhere, the geographical diversification dramatically reduces the systemic risk, posed by local economic ups and downs. On top of that, lower operational costs mean higher returns for investors.
No one’s left behind
39% of the world’s population doesn’t have a bank account and one of the prime benefits of using cryptocurrencies is that it enables borrowers without a bank account or credit history to take out loans. That could never be possible within the traditional banking system. Blockchain-based P2P lending platforms can bring financial services to clients who have previously been barred from participating in the economy.
A useful platform for hectic world
The peer to peer crypto lending will be a great helper for users during the financial crisis or suddenly face the situation requiring money with a large amount. However, the users always can ransom their assets all the time after solving their personal problem with affordable interests.
How does Crypto lending work?
Normally, it works by connecting borrowers to lenders via an online platform. Instead of money, crypto lending trade on cryptocurrencies via a crypto lending platform. Lenders on crypto lending receive their interests once the borrower repays the loan. A lender makes its assets available to loan at a certain rate.
Users usually lend their cryptocurrencies for two main reasons: first, for personal use and second, for margin lending. With the later, once the lender’s funds are available, a borrower who believes a certain coin will increase in value will request to lend a part of the funds availed by the lender. Crypto lending can differ, depending on the platform, but what remains constant is the core concept.
Suggested crypto lending platforms
The below list comprises the leading platforms that offer cryptocurrency lending services. If you are thinking of trying out this type of lending, these platforms may provide you with the best starting options.
- King Vault
King Vault is a financial application that allows users to deposit and receive interest and borrow money as collateral with digital assets: The asset holder wants to deposit the asset on the exchange to receive interest periodically up to 6.5% annual percentage rate. While, borrowers pledge assets at a rate of X% to the floor, when the property price falls below the specified contract liquidation. King Vault accepted Cryptos such as BTC, USDT, ETH, BTCN with an interesting rate for users.
- Help reduce additional fees compared to the traditional method.
- Loan approval speed is faster than usual
- Fixed and attractive interest rate
- Eliminate the need for a middleman
- Reduce latency and quickly approve
- Bring transparency
- Effective lending process
- Smart contracts quickly automate the lending process
- Peer-to-peer loans offer better interest rates than traditional loansKing Vault is operated mainly on the nature of the Blockchain system. And the two main characteristics of blockchain technology are the trust-evoking nature and decentralization that is essential for the growth of peer-to-peer lending. At the same time, this application meets the flexibility, privacy and reliability that the vast majority of users expect from a crypto loan application.
King Vault is really an application and platform worthy for you to use by highly responsive to diverse needs in the daily life of users.
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- SALT Lending
This platform offers Blockchain-backed loans with Bitcoin, Litecoin, Ethereum, and Dogecoin as collateral. SALT is a short form of (Secured Automated Lending Platform.
P2P cryptocurrency lending solutions are a welcome alternative rather than cash. They capture the spirit and utility for which bitcoin and altcoin designed and complement P2P exchanges to result in a trustless and permissionless financial system that is open to all. It is worthy for traders to experience P2P crypto lending platform from today.