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Cryptocurrency lending, what it is, how it works, risks and platforms

What does cryptocurrency lending mean and what is it? How does it work and what are the risks? Discover the best Crypto platforms in this simple guide

Cryptocurrency enthusiasts are often encouraged to “HODLARE” their assets, keeping them safe in a wallet until the price of the chosen currency increases in value. Doing so, however, and as if you left your euros in the current account without being able to obtain a passive income.

This is where crypto lending called in the world of cryptocurrencies, Lending, comes into play. Not only can it allow savers to receive interest expense from Bitcoin and other cryptocurrencies, but it allows borrowers to unlock the value of their digital assets by using them as collateral for a loan..

It is important to underline how important it is to use these forms of investment only if you are sure that you do not have to use the money invested in the short term. In this simple guide for beginners, we would go to see what Lending is in the world of cryptocurrencies, how it works, what are the risks and what are the best platforms to sign up to start generating extra income.

How does Lending work in the world of cryptocurrencies?

Let’s imagine that Francesco has 2 BTC in his wallet. He does not want to sell them because he bought them for 1000 dollars and is confident that prices in the future will continue to rise considerably. Francis is also concerned that, if he were to use them to trade, there will be a risk that he could lose them all.

Cryptocurrency lending platforms such as Nexo, YouHodler or Celsius Network, can come to the rescue. Francis will be given the opportunity to use his Bitcoins as collateral and to receive a loan in stablecoins (euros, dollars or pounds). Due to the volatility of digital assets, it will normally have to “guarantee over 100” of the amount borrowed, which means that it will have to block more BTC than the total value of the funds it is requesting. In this way Francis will be able to take his dollars, put them on a passive income with a percentage higher than that of the loan and thus continue to earn.

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Once the loan and interest have been repaid, Francesco will be repaid in full the two Bitcoins he offered as collateral for his loan. he will make a nice profit if BTC ends up appreciating as he had predicted. In this case, Francesco exposed himself to a risk of liquidation if Bitcoin fell too low by a certain figure. His cryptocurrency would only be at risk if he failed to keep up with the terms of the loan, or if the value of the Bitcoin held as collateral fell below the value of the loan he received.

What is Lending, Lending in Decentralized Finance (DeFi)?

DeFi lending platforms are completely decentralized, and transactions are handled by code instead of people. On services such as Aave, Compound and dYdX, smart contracts use algorithms and protocols to automate loan payments also called landing and borrowing.

Anyone can access the protocols via a decentralized online financial platform. Registration and identification takes a few minutes after downloading the mobile app. This makes them completely transparent, as nothing can be hidden on the blockchain. Unlike CeFi platforms, there are no financial intermediaries or regulators, which means you don’t have to go through a verification process like KYC. However, DeFi interest rates for lending cryptocurrencies often pale in comparison to what centralized rivals can provide.

Getting a BTC or ETH loan – or any other type of crypto loan on a DeFi platform – is very quick as you won’t need to go through any kind of due diligence. Thanks to smart contracts, all a user will have to do is apply for the loan and then send the cryptocurrency they want to use as collateral to a specific wallet associated with the lending platform. Users of decentralized lending platforms can apply for a loan of any size without having to confirm their identity to a third party. Loans can be supported in stablecoins such as USDC, fiat currencies or cryptocurrencies such as Ethereum or BTC.

Best platforms to apply for a crypto loan?

On many centralized and decentralized lending platforms, you will have the option to open a savings account using your cryptocurrencies, as well as exchange tokens or borrow. With both types of lending platforms still in the early stages, it’s clear that this is an exciting space to watch. There is a lot of room for growth and the potential to access loans without the usual formalities could be a gun game changer for both people and the financial services industry.

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Check out the full article with reviews here. Among the best platforms we can mention:

  • YouHodler
  • Nexo
  • Blockfi
  • CoinLoan
  • Binance Car Hire
  • CoinRabbit Property
  • Celsius Network
  • Aave
  • Compound
  • MakerDAO

🏆 Crypto lending platform
YouHodler

🥇 Best Broker for Staking Crypto
eToro

🏅 Exchange for crypto loans
Binance Car Hire

How to get a loan in Bitcoin and cryptocurrencies?

If you like the sound of a BTC loan but don’t know where to start, you have two main options: centralized and decentralized lending platforms. Crypto loan on centralized exchanges: Centralized ecosystems such as BlockFi, Nexo, and Binance must follow certain rules and procedures to be compliant. You will need to create an account by registering for the chosen platform and follow the Know Your Customer (KYC) procedures in place to prevent fraud and money laundering.

These platforms typically have protocols in place to ensure your warranty is safe. Some protect crypto assets through insurance or keep most digital assets in custody in cold storage, which means they are away from an internet connection. Centralized crypto lending platforms will continue to record all deposits and withdrawals using blockchain technology, visible to all, and will offer a great way to earn interest on Bitcoin, along with many other cryptocurrencies and stablecoins such as USDC and DAI. To put it in perspective, the best USD savings account bank rates barely exceed the 1% APY mark, yet many platforms offer up to 8% on cryptocurrency interest rates. It’s worth doing your homework to get the best deal and avoid paying over

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-average rate. There are more paperwork needed to get a loan through a CeFi platform, but the fact that there is a regulated environment and a customer service representative just a click or phone call away could make these platforms more attractive to traditional investors.

Cryptocurrency loan on Binance

Binance offers crypto loans to its users who wish to borrow stablecoins such as BUSD and USDT, the best cryptocurrencies such as BTC and ETH, and many more on the Binance lending platform. The loan guarantee can be BTC, ETH, BNB and other crypto assets. The initial LTV is 65%.

Important to note for interested parties is the margin call, which occurs at 75%, and the liquidation LTV at 83%.
The terms of the loan are 7, 14, 30, 90 and 180 days, and interest is calculated every hour.

Binance users can choose to repay the loan in advance, however interest will be rounded up to the nearest hour. As of September 9, 2021, the hourly interest rate is 0.001667% and accumulates every hour once the user successfully borrows the crypto asset.

Cryptocurrency lending on BlockFi

BlockFi was founded in 2017 to provide credit services to markets without access to simple financial products, offering attractive rates and quality institutional services. BlockFi’s main product is its interest account, which allows users to earn up to 8% of APY by lending their crypto assets.

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BlockFi also offers crypto loans, which cost up to 4.5% in April.
However, BlockFi crypto loans have higher requirements than Binance. To begin with, the minimum loan amount is $10,000 USD. In addition, LTV is lower, that is, more rigorous, at 50% and margin demand at 70%. However, BlockFi users will be able to receive the loan funds on the same business day and can repay the loan in advance, similar to Binance.

Is BlockFi safe?

BlockFi’s primary custodian is Gemini Trust Company LLC, a company regulated by the New York State Department of Financial Services. It is also backed by major institutional investors, such as Galaxy Digital, Fidelity, SoFi and Coinbase Ventures.

However, cryptographic accounts on BlockFi are not protected by FDIC or SIPC. In addition, three U.S. states — New Jersey, Alabama, and Texas — have banned BlockFi interest accounts, alleging that it violates state securities law. While this does not directly affect the BlockFi crypto loan product, it could have a negative impact on users’ access to BlockFi.

Crypto loans without guarantees

The second option for lending cryptocurrencies would be to switch via a decentralized platform, known as DeFi for short.

Unsecured crypto loans, also known as unsecured crypto loans, are innovative new financial services that provide short-term liquidity and can be repaid in fiat currency or cryptocurrency. The idea is to borrow funds directly from a lender using a cryptocurrency as collateral instead of traditional assets such as property and gold.

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If you are interested in an unsecured crypto loan or an unsecured crypto loan, there are numerous platforms that make it possible. For example, flash loans are a popular example of crypto loans without collateral, but they require a high level of cryptographic knowledge to navigate. Before proceeding with any crypto loan without collateral, be sure to do your research and make sure the platform is legitimate.

How do refunds in cryptocurrencies work?

In the crypto world, refunds can also be more flexible and faster with costs almost reduced to a minimum. And while it can take several days for loans to be liquidated in the old financial world, loans in Bitcoin and other cryptocurrencies can be virtually instantaneous.

You’ll also be able to liquidate your assets without triggering a taxable event, and you’ll be able to tailor the loan to suit your needs. Users can also switch between cryptocurrencies, so they can deposit Ether and borrow Tether, all on the same platform.

Borrow crypto meaning

Borrow in the crypto world has as its meaning a crypto exchange or from a crypto cryptocurrency lending platform. Crypto lending works similarly to a mortgage or car loan, where you use car or home ownership as collateral, while in this case you use cryptocurrency to protect the loan funds

How did crypto loans start?

Therefore… when did the cryptocurrency lending take off? Well, it was precisely in the period when economies stopped abruptly in 2020 due to the pandemic. This has seen interest rates be reduced and loans for large items have plummeted. Many people were looking for other ways to make their resources work for them. Crypto loans have become a quick and easy way to access fiat currencies almost instantly, all without selling it. Suddenly, the days when Bitcoin and Litecoin collected dust at an exchange or cold room were numbered.

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Unlike personal loans or credit cards, secured loans are much safer for the lender, which allows the borrower to benefit from low interest rates. Cryptocurrencies can be very volatile, which is why these loans are almost always over-secured. This provides insurance for the lender in case the price of cryptocurrencies should plummet. However, this can have a negative impact on the borrower, especially if the platform they use requires them to maintain the loan-to-value (LTV) ratio at all times.
Benefits of taking a crypto loan

One of the main bonuses that many see in a crypto loan is that, unlike the traditional banking system, you will not be subject to the evaluation of your credit score. This means that lending is more accessible to people who don’t have a financial history, under-the-counter consumers who don’t have a bank account, and the self-employed who have difficulty accessing credit because their fluctuating earnings don’t meet a bank’s strict lending criteria.

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Price prediction

BTCs change trajectory upwards | Rising forecast for Bitcoin

Forecasts for Bitcoin (BTC) change after price action has changed trajectory. In this regard, there are a number of analysts who fear a downward trend throughout 2022 after the recent market imbalances. In this context, we are not sure that BTC/USD will be able to end the year above its initial price.

Can Bitcoins rise from the recent bottom?

The question is legitimate considering the recent downward trends in the market! In this context, it is feared that Bitcoin may consolidate in a smaller than expected size due to the upheavals of the global economy. That is why the forecasts on the prices of BTC have definitely changed with a collapse in demand due to the macro pressures that connected with the implosion of Terra LUNA have caused the overcoming of historical lows.

What will happen in the coming months has a lot to do with a key event where the BTC/USD pair could fall to $20,000 or less. This scenario would confirm the risk status of BTCs. It is also true that under this fund we can no longer descend. As a result, many are hoping for the twist that usually occurs after such a deep fall. To the extent that Nasdaq and Bitcoin rise, the fact that the market has already bottomed out could be an advantage.

In this context, the US exchange Coinbase has suggested a series of forecasts based on some indicators that in fact inform us about the nature of this imminent change. The idea of an actual upside is still far too elitist with many traders considering its push decidedly flat, yet correlated stock markets have posted gains that portend a different future. In this regard, a good slice of analysts spoke of a forecast of $ 200,000 for 2022 made shortly after the last all-time high of $ 69,000 last November.

On this wavelength it is clear that there is still a lot of confusion about what can be done to intervene. The argument is that basically it is not clear how much the bullish movement can be a reality right now with different schools of thought. According to MicroStrategy CEO Michael Saylor, it is to firmly reject any suggestion of a permanent price reduction.

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At this point it is fair to remember that those who supported a permanent bearish wave have completely lost credibility. If the deniers of the rise were wrong, it is evident that something went wrong. As a result, Saylor says, “if it doesn’t go to zero, it’s going to go to a million, referring to the fact that if the negative outlook on this asset is not completed then the upside will be inevitable.

Concluding the uptrend that seems to be an immediate possibility would certainly shake up the market by offering investors an opportunity for redemption despite the detractors who continue to row against. What we need to understand is that there is nothing deeper than the abyss touched by BTC in recent sessions. Now you can only bounce upwards and recover the accumulated losses.
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The Sandbox price predictions 2022, 2023, 2024, 2025 where to buy

The year 2021 was as crazy for SAND as it was for the entire market. In January 2021, SAND recorded decent growth. But what are the price forecasts for 2022, 2023, 2024 and 2025?

Historically, human beings have always been interested in art and entertainment. Today, the entertainment industry is one of the most profitable at the monetary level. People like to listen to music, watch TV, watch works of art, attend concerts, theater performances, and play different games. As life becomes more digital, so does the way people enjoy themselves. Before the technological revolution, people had to go to the theater to see a show. Now they can simply open the computer and go to Netflix, select a movie and enjoy the show. Also, years ago, people had to go and listen to the musicians who performed live. While today they can listen to anything using their phones.

Blockchain technology continues to attract new institutional and retail investors. After the announcement of the name change of Facebook and the big investments related to the world of the metaverse, the gaming industry is preparing to take the next step and change the life of every player forever. In addition, the gaming industry is bringing the virtual world into the real world through the metaverse. At the time of writing, the metaverse is still small, but as the implementation grows, so does the metaverse.

Many companies such as Atari, Binance and Adidas have purchased packages in the Sandbox metaverse. In addition, TV shows such as The Walking Dead and The Smurfs have also purchased their own packages. As the icing on the cake, Snoop Dogg recently purchased dozens of lands to advertise his products and music. Some of the most promising metaverse projects are Decentraland with huge growth forecasts, Sandbox, Metahero and ECOMI. However, Sandbox is really the center of attention. The opening to the Alpha phase, which took place on November 29, 2021 and closed on December 20, has done nothing but turn the spotlight even more on this world. But what is Sandbox? Is it really convenient to invest money and buy this crypto for the future? What could be the price in 2022 and the next 5 years (2023, 2024, 2025, 2026)?

The Sandbox ($SAND) Crypto what is it?

The founders of this project are Arthur Madrid and Sebastien Borget. Although the official founder is Pixowl, Arthur and Sebastien were CEO and COO of Pixowl at the time of sandbox’s launch. Sandbox is a virtual world built on the Ethereum blockchain. In it, people can build, create and exchange in-game digital assets. Their main goal is to connect the real world to the virtual world, the world of games to be more precise.

$SAND is the token that powers the Sandbox project. At the time of writing, there are about 913 million SAND tokens in circulation. This token has a maximum supply of 3 billion tokens, which makes it a token with a limited supply.

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The original Sandbox game was launched in 2012. However, the creation of the blockchain version of Sandbox, the Metaverse Sandbox, began in 2018. The Alpha version was released on November 29, 2021. This was one of the main causes of Sandbox’s price increase. What makes Sandbox special is its planned decentralization level. The leadership of the Sandbox project could be entrusted to a decentralized autonomous organization (DAO). This means that there may be no central authority and the power of government is returned to the users. Many people call the Sandbox metaverse the decentralized and updated version of Minecraft.

The price of The Sandbox over time

According to CoinMarketCap, Sandbox entered the market on September 15, 2020. Initially, SAND was trading at $0.051. However, only after two weeks, SAND reached a price of $ 0.073. After setting an all-time high, the price of Sandbox returned to its initial price. Its price rebounded between $0.038-$0.051 throughout the rest of 2020. That said, SAND left the year 2021 with an exchange value of $0.035.

The year 2021 was as crazy for SAND as it was for the entire market. In January 2021, SAND recorded decent growth. By the end of January, its price had doubled and 1 SAND was trading at $0.082. The upward trend has been going on for months and on March 28, SAND set a new all-time high of $0.83.

In the summer of 2021, SAND lost more than half of its value. By June 21, SAND had fallen to $0.17. However, this token did not need much time to recover. On September 1, SAND returned to the track and finally crossed the $1.00 milestone. The token met a resistance level around the price of $1.00, causing the price to fall. On October 29, 2021, SAND finally broke the resistance. On November 3, 2021, SAND reached a new all-time high of $3.21. Just 3 weeks later, SAND set another all-time record reaching a price of $8.51.

The SandBox Sand price predictions 2022 – 2023

Sandbox has received all the attention lately due to its big bullish movement and the release of the game in alpha version. Most of the predictions about this token are bullish, but only a few provide a reason to believe that the future of this token is really bullish.

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On December 4, 2021, retrace, on the day of the Bitcoin crash, going to rebound to the price of $ 4.1048. After a strong bullish impulse started in mid-June, which saw the price soar to 5467%, discharge are 51%. According to Gov Capital, SAND could grow even more during the year 2022. Their forecast shows that SAND will be trading at a price between $1.36 and $0.50 by the end of May 2022. Once the bear market is over, many investors will also be optimistic for the year 2022, giving SAND a possible annual high of $4.61. Moving forward, SAND could continue its growth and surpass the $8.00 milestone during the year 2023. By the end of 2024, 1 SAND could be worth up to $37.49. In the long run, SAND could reach a trading value of $73.42 in exactly five years’ time..

The best exchanges to buy The Sandbox and your Sand token are Crypto.com (get $25 free with the code rvyc2zzuaa), , Binance and Kucoin. These 4 exchanges have both a smartphone application and a professional exchange that can be used from a PC. Coinbase and FTX have also joined the list in recent months.

Sandbox (SAND) Price Prediction 2024

The year 2024 could be golden for the cryptocurrency market.

Sandbox is expected to enter the year 2024 with a price of about $ 33. However, the price of SAND could explode in the fourth quarter of 2024, causing it to exceed the $50 milestone.

By the end of the year 2024, SAND could be trading at $47.50.

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Sandbox Price Prediction (SAND) 2025

Similar to 2021, the year 2025 could be the year when SAND will experience the consequences of Bitcoin’s halving event. This means that the market around SAND could continue to be bullish.

As a result, the price of SAND could double during the year 2025. By mid-2025, SAND could reach an exchange value of between $64.00 and $70.00.

After this peak, its price could return to $55.30 and then skyrocket once again. On December 31, SAND could reach a price of $80.

The sandbox (SAND) price prediction 2026

Talking today about what could be the cryptocurrency market in 5 years is not very easy. However, we can imagine that in 2026, the market could be less volatile, which would mean much narrower price movements.

After that growth, SAND could drop to $75 and build a support zone there. SAND can start a slow uptrend.

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Due to its offering, SAND may experience a slow rather than rapid increase. However, this would be a good thing for SAND as it would reduce the likelihood of a dump. After exactly five years, SAND could reach an exchange value.

Will Sandbox (SAND) reach $100?

The answer could most likely be yes. Sandbox has earned invectors over x100 since it was first launched. However, this cryptocurrency still has a lot of room to grow.

Unlike traditional online games, The Sandbox is a whole ecosystem. This allows it to perform several functions at once.

In addition, Sandbox uses a Play-to-Earn model that allows players to earn actual money paid in cryptocurrency. People can even implement their DApps in the metaverse. This will serve as an incentive for people to start playing and investing in the game.

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Where does the value of Ethereum come from? Founder, euro chart, mining

Andreessen Horowitz (a16z), a Silicon Valley-based venture capitalist, has released his first edition of the annual report covering the state of the cryptocurrency market. During the discussion on new developments in the industry, a16z said that Ethereum continues to dominate the web3 space but could face competition from some other projects that have shown a similar growth trajectory..

“Ethereum dominates the web3 conversation, but now there are many other blockchains as well. Blockchain developers such as Solana, Polygon, BNB Chain, Avalanche, and Fantom are aiming for similar success. ”

The report states that Ethereum’s position and its future value is at the top of the cryptocurrency scale is largely based on the advantage of having been one of the first cryptocurrencies and on an evergreen community. As a result, developer interest in Ethereum has far outpaced other competitors: Ethereum has nearly 4,000 monthly active developers while the second closest was Solana with 1,000 users and Bitcoin with 500. However, a16 added that Ethereum’s decision to choose decentralization over scaling was to allow smaller competitors to attract users by charging lower gas fees and offering faster transactions. The network has also faced competition from blockchains that offer interoperability and “layer 2” technologies that reduce costs by expanding the available block space.

How close the other projects are to Ethereum

In fact, several projects have gradually risen to the top of cryptocurrencies after the success of Ethereum. The likes of Solana, Cardano, Avalanche, BNB, and Polygon have amassed a large user base, and some even have distinct network advantages over Ethereum. But have they really eclipsed the market leader? We would like to remind you that if you buy Ethereum, you then have the opportunity to get a passive income by staking it on Cefi platforms. Learn more about how to do it >>>

Well, in terms of revenue on the chain, Ethereum was still the most valuable blockchain in the world. It reported revenue of $30 million in April according to Cryptorank, easily beating the second highest BNB chain by nearly $600 million. Bitcoin held the 4th position with a 30D turnover of $12.5 million.

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In addition, in terms of average daily issuance, Ethereum has maintained an advantage over Bitcoin. The amount of coins created by a particular network minus the amount that is destroyed is known as Burn. In short, the average daily issuance indicates the usefulness of a network in terms of transactional activity. Moving on to NFTs, smaller projects still had to challenge Ethereum’s dominance. Home to some of the largest and most well-known NFT markets in the space, including the world’s largest NFT platform, OpenSea has recently offered its customers the ability to pay by credit card. According to the Cryptoslam data tracker, Ethereum ranks first in terms of blockchain by NFT sales volume. Axie Infinity and Solana are in second and third position.

The value of Ethereum in Euros over time

Ethereum remains the leader but its position as the best crypto blockchain although its leadership in the future is not entirely secure. With many projects on his heels he will have to know how to defend himself. Ethereum’s euro value could reach a new all-time high over the next eight years. According to the growth assumptions expected by the best crypto consultants and analysts, the price could grow up to 15,450 euros.

The number of Ethereum coins currently in circulation is very different from when the Ethereum blockchain was first launched in the summer of 2015. At the time, there were about 72 million ETH. In January 2021 there was a circulating supply of 113.5 million tokens and now they are about 120 million.

Ethereum is the number one choice of the best cryptocurrencies to invest in 2022. Most of the cryptocurrency projects analyzed in this article are based on the Ethereum blockchain.

Who is the founder of Ethereum?

While Bitcoin reigns supreme in the cryptocurrency market, Ethereum is the second largest on the market, and it was the fruit of Vitalik Buterin, who came up with the idea when he was just 19 years old. Vitalik Buterin’s estimated net worth is 355,000 ETH, which equates to about $1.5 billion. Vitalik has most of his net worth in his project, Ethereum, and other digital assets like Shiba Inu.

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Nine years ago, Buterin envisioned Ethereum as a way to leverage the blockchain technology behind Bitcoin for all kinds of uses besides currency. Since then, Ethereum is like the fundamental layer of what proponents claim will be a new decentralized, open source Internet.

Vitaly Dmitriyevich “Vitalik” Buterin (Russian: Виталий Дмитриевич Бутерин; born January 31, 1994) is a Canadian-Montenegrin programmer and writer of Russian origin, best known as one of the co-founders of Ethereum.

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