Hello, I am a housekeeper (@ ieneko 62) who is training a cryptocurrency.
Suddenly, do you know the cryptocurrency (lending) service ?
You can increase the cryptocurrency simply by depositing the cryptocurrency on the exchange !
Lending attracting attention as a form of new asset management.
However, there are notes, so consider carefully and please consider it.
This time we will explain coverage from the outline of lending of cryptocurrency to advantages and disadvantages, and comparison of exchanges doing lending service in Japan.
What is landing?
Lending cryptocurrency refers to a service that lends out cryptocurrency and obtains interest (interest) .
- What is interest (interest)?
- Consideration paid at a fixed rate when lending and borrowing money etc. The lender can obtain the principal and interest. The borrower must pay the principal and interest.
It might be easier to imagine if you consider the cryptocurrency lending service just like a bank deposit system.
You can deposit the cryptocurrency you hold in the cryptocurrency exchange and earn interest for the time you deposit it.
In short, suitable for, such as those who are Gachiho the cryptocurrency in the can increase the cryptocurrency in the only deposit even without trading, has attracted attention as a new investment law.
If you have proven lending, it seems that performance is better than bad people doing cryptocurrency. Now that the interest of the bank is not equal, virtual rate lending of a few percent per year is attractive.
– The wise men of the cryptocurrency (@ adamn 3611) July 11, 2018
Since cryptocurrency is not planned to be sold, it is forced to turn to lending. If you deposit 10 million yen, it will be returned to 10.5 million yen. However, there is a risk of hacking. It would be nice if you could do lending in distributed type. https://t.co/XkepSvn4eP
– Ike Haya @ Bloggers Guild (@ IHayato) June 12, 2018
How cryptocurrency lending works
Strictly speaking, the cryptocurrency lending is based on the composition that the person who wants to lend (the person who wants to lend) deposits the cryptocurrency in the “exchange” and the “person borrowed” borrows the cryptocurrency from the “exchange” It is getting.
The exchange matches the so-called “borrower” and “the person who wants to lend” (person who wants to lend) “and acts as an intermediary.
For cryptocurrency lending, it is a premise that the three people “borrower” and “person who wants to lend” (person who wants to lend) and “exchange” are available. (However, there are many patterns that lend and borrow directly between users without going through exchanges at overseas exchanges)
So what is the person who “borrows” the cryptocurrency? The question is raised.
The answer lies in the transaction method “leverage transaction” .
There are mainly two types of trading , “spot trading” and “leverage transaction.”
- Two types of investment method
- “In-kind trading”
Make transactions within the range of funds invested with exchanges or other users.
“Leverage transaction” You can borrow a Japanese yen from the exchange, and can make many times trading with the former. On the other hand, the investment method with a high risk high return that it may double a profit while obtaining profits.
Because leverage transactions can apply multiple times of leverage, many times more funds are needed and you need to borrow Japanese yen from exchanges.
The structure of the three people “borrowers” “people wanting to lend (people who want to lend)” “exchange” is summarized as follows.
To borrow leverage transactions, borrow a Japanese yen on the exchange and pay interest for that exchange to the exchange
“People I’d like to lend (people who want to lend)”
Lend cryptocurrency to exchanges and receive interest for that period
You can earn as much as the difference between the above interests
The lending service is established by matching supply and demand of the three people “borrowers”, “people who want to lend” (those who want to lend), and “exchanges”.
Benefits of cryptocurrency lending
【Merit ①】 You can earn interest only by depositing the cryptocurrency
The biggest benefit of cryptocurrency lending is that you can still earn interest only by depositing it .
Because you do not need trading skills, it is recommended for those who do not have confidence in trading.
Also, the advantage is that the obtained interest rate is around 5% annually .
I think that you can see the magnitude of the bank deposit compared to about 0.01% per year.
【Merit ②】 Fraud is less likely to occur
Since the exchange is managed as an intermediary between the lender and the borrower, it is impossible for the borrower to escape the funds of the lender, which makes it harder for wrongdoing to occur.
Disadvantages of cryptocurrency lending
[Disadvantage ①] Risk of the exchange breakdown
If the trade exchange you deposit fails, the deposited asset may not come back.
You can think that there is almost no compensation for lending.
[Demerit ②] During the contract period, you can not move lent cryptocurrency
The cryptocurrency has a characteristic that the volatility is high.
During the term of the lending contract, even if it collapses you can not withdraw the cryptocurrency you lend out and sell it.
In other words, it can not cut off in the middle.
Although cancellation can be done halfway, cancellation fee is generated halfway .
When making a lending contract, it is necessary to carefully determine the timing with the contracted exchange.
Domestic exchange comparing lending services
※ Please confirm here as occasion as of July 2018.
|Supported cryptocurrency||BTC (Bitcoin)|
|Lending period||1 year|
|Annual rate|| 1 ≦ X <5 ... 3% (*) |
5 ≦ X <10 ... 4%
10 ≦ X 5%
|Number of lendable quantities||1 to 25 BTC|
|Cancellation fee||5% of the rented amount (※)|
※ X is the quantity of BTC. The higher the quantity to lend, the higher the annual rate.
* If you sell 10 BTC lent, 0.5 BTC will be paid as a cancellation charge in the middle and the remaining 9.5 BTC will be refunded.
- bitbank lending service outline
- Currently only for Bitcoins are being solicited, other virtual currencies such as ripple, light coin, etherium, monacoin Bitcoin cash etc. are also planned.
· Recruitment period · Recruitment month
We recruit lending applicants from the 1st of every month to the end of the month, and call that period the recruitment month.
If the recruitment month is July 2018, the recruitment period refers to July 1, 2018 – July 31, 2018.
※ Notice of lending service will be sent to registered e-mail address at beginning of month
· Expiration date The first day of the next month of the recruitment month is set as the starting date, and after that 12 months (the end of the following year of the offering month), the expiration date is taken.
If the recruitment month is July 2018, August 1, 2018 is the start date, July 30, 2019 is the expiration date.
· The next day of the expiration date of the return date is taken as the starting date and within 10 business days the same kind, equivalent amount, including the consumption tax equivalent to the bitbank account, and the same amount of lent cryptocurrency and interest are refunded.
Source: bitbank trading rules
Once you have opened an account, you can receive lending services. First of all, open an account!
※ GMO coins are occasionally lending services. Bitcoin recruitment requirement in April 2018 Alto Coin refers to the recruitment requirement in May 2018. Please check on the official website news from time to time.
|Supported cryptocurrency|| BTC (Bitcoin) |
BCH (Bitcoin cache)
LTC (light coin)
|Lending period|| BTC → 90 days |
Alto Coin → 150 days
|Annual rate||5% (tax included)|
|Number of lendable quantities|| 10 BTC to 100 BTC |
100 ETH to 1,000 ETH
50 BTC to 500 BTC
300 LTC to 3,000 LTC
100,000 XRP to 1,000,000 XRP
|Cancellation fee||(Lendout quantity × loan period × interest rate) / 365 (※)|
* 10 BTC as being borrowed for 60 days (10 × 60 × 5) / 365 As the cancellation fee is 8%, it pays 0.8 BTC and the remaining 9.2 BTC will be refunded.
- Overview of GMO coin’s lending service
- In the GMO coin, lending applicants are recruited irregularly and the target currency is also different at that time, so you need to check the application guidelines on the official news page of the GMO coin.
· Recruitment period · The recruitment month is irregular, generally recruiting from the beginning of the month to the end of the same month.
· Expiration date As the start date of the borrowing period, the day specified in the individual contract shall be the execution date, and the date on which each date has passed since then shall expire as the settlement date.
· On the return date settlement day, return the same type, the same amount, the same amount of cryptocurrency and interest as the borrowed target currency to the user’s account.
Source: GMO Coin Rental cryptocurrency Service and Conditions
Account opening is required to receive lending service. First of all, open an account!
Lending service circumstances of overseas exchanges
On overseas exchanges, bitfinex and Poloniex etc. mainly perform lending services.
Unlike domestic exchanges, it is mainstream to directly lend to FX users without going through exchanges .
Because it is done by users, it is attractive that you can freely set the loan date, have plenty of interesting currencies and set high interest rates.
Since the interest rate can be set up between users, it is variable interest rate.
Let’s check the interest rates from time to time here.
However, because you lend out without going through exchanges , please be aware that the risk of bad debts is high and that the cryptocurrency does not return.
Both trading and lending have advantages and disadvantages, but lending is considered relatively low-risk low return compared to trading.
I think that it is a pleasant service to those who are excited.
However, let’s fully understand that you need to figure out the timing with the contracted exchange and the timing.
We recommend that you do lending with surplus funds.
Who wants to increase assets steadily, consider reviewing lending?
Author: House Cat – Source Post: https://crypto-times.jp/what-is-lending/
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