The crypto industry has been around for only a decade and is fairly new. However, throughout this short period of time, there have been numerous advancements made in the crypto world. One of the newest developments is the rise of platforms created to lend loans to people with crypto coins. Every one of these platforms has a unique strategy, yet, the common theme is getting cryptocurrency by use of smart contracts.
Interest, as well as credit payments, are tracked through the smart contracts, which also prevent interference in the process. In contrast to traditional loans, credit checks and scoring are not needed. The lender also can’t apply physical pressure towards the borrower.
Crypto loans appeared in the public eye last year when the market was suffering and Bitcoin prices were declining rapidly. There were many crypto investors at that time that did not want to sell the coins with low prices, so they lent their crypto investments and earned money through interest.
There are numerous reasons why crypto loans earned popularity in the crypto community. The interest rates of crypto lending are low. In addition, there was a significant increase in the number of crypto owners that were interested in receiving profits quickly. The system for crypto loans is usually much more efficient than the traditional system, which means that people that were refused loans by banks could switch to cryptocurrency.
This new market grew very quickly and is currently estimated at around 4.7 billion USD. The number of users is increasing on the daily basis. Based on numerous reports, lenders have made 86 million in interest in the last year and the volume of lending grew to 159 million USD in the second quarter of 2019.
As the crypto market, particularly Bitcoin, is seeing an increase in prices, the crypto loan industry is becoming bigger and bigger.