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The crypto lending platforms may charge you a fee for availing their servicesAs the returns from investing in stocks depleted, primarily due to the disruption caused by the COVID-19 pandemic, cryptocurrency gained wide acceptability among investors.
Both individual and amateur investors flocked to the industry that promised decent returns even amid the economic slump that made many nervous.
While cryptocurrency supporters say it offers a great opportunity to grow wealth rapidly, critics cite its extreme volatility.
Even as the debate continues, this industry has grown multi-fold over the past two years.
And it is still innovating and adding new features.
One of them is crypto lending.What is crypto lending?Crypto lending is a pretty new segment.
It allows traders to obtain cash by utilising their crypto holdings as security, without having to sell their coins.
Individuals may secure loans against their crypto assets, expecting the value of the assets to increase during the period of the loan.
The aim of this type of investment is to allow those with cryptocurrency assets to generate some dividends by lending out part of their assets.
Lending is usually available via crypto lending platforms.What is a crypto lending platform?It is an online platform that allows you to lend your cryptocoins in exchange for an interest.
These platforms are used by two parties.
One of them acts as a lender and the other as a borrower.
Borrowers need physical (or fiat) money from lenders by depositing an equivalent amount of cryptocurrency with them as collateral.The rate of interest depends on the coin.
The crypto lending platforms may charge you a fee for availing their services.What are the crypto lending platforms operating in India?1) BlockFiYour Bitcoin can earn up to 7.5 per cent annual percentage yield (APY) with BlockFi, which calculates interest on a daily basis and pays monthly.
BlockFi allows a borrower to take a loan against their crypto assets while keeping them.2) Crypto.comAnother such platform is Crypto.com.
It offers the option to borrowers to pay the loan in full or in part at any moment during the 12-month fixed loan period.3) ZebPayIn May this year, ZebPay announced it was adding the crypto lending feature in its app.
Initially, it is facilitating loan against only a limited number of crypto coins such as Bitcoin, Ethereum and Ether.4) CoinDCXOne of the biggest crypto trading platforms in India, CoinDCX also offers this feature to its users.
ConDCX calculates its interest rate dynamically, based on market demand and supply for the cryptocurrency that is to be lent.5) HoldnautA financial services platform, it allows private investors to earn interest on their cryptocurrencies by lending them to institutions.
Its users can earn interest rates by depositing their crypto assets into a Hodlnaut Interest Account.
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