What Is Cryptocurrency Landing And How To Make Money On ItAdmin
By 2022, many active platforms will allow you to take and issue digital assets to other clients of interest. Typically, cryptocurrency lending is carried out between users of such services. Digital platforms are essentially brokers. Even unique platforms do not work according to the principles of traditional banks.
This lending method is called cryptocurrency lending. Investors use this method to increase profits.
- The principle of operation of the cryptocurrency landing page
- Types of lending
- Top Platforms
- How to choose a platform
- Possible risks
Table of Contents
The principle of operation of the cryptocurrency landing page
The method involves mutually beneficial cryptocurrency lending to users. Platforms rarely issue loans to customers. Services often work as brokers.
Landing virtual coins and tokens involve issuing and receiving cryptocurrency loans at interest. However, it often offers lower annual rates than traditional banks. The mandatory provision of loans explains the fact by borrowers. The amounts depend on LTV. This parameter is equal to the following ratio: the amount of possible credit/security. It also reflects the investment risks of cryptocurrency loans.
In the direction of digital lending, there is the concept of liquidation. The term means the cancellation of guarantees under certain conditions. For example, often, the risk appears when the market rates of cryptocurrencies decrease. In this case, the amount of the required deposit increases (in the number of coins or tokens). Then the borrowers need to replenish their collateral account. This is the only way to avoid liquidation.
Types of lending
For 2022, there are 3 methods for obtaining good loans in cryptocurrencies.
|Landing||This method involves obtaining loans from users of digital assets. Landing is usually carried out through the services of brokers.|
|Leverage||The method involves obtaining loans from cryptocurrency exchanges specifically for trading in the virtual asset market. This type of lending is used for margin trading.|
|Buying crypto assets with a credit card||In 2021, many popular exchanges began to implement this feature. At the same time, when buying cryptocurrencies with credit cards, loans are issued by traditional banks. They provide asset acquisition.|
For 2022, there are many platforms for cryptocurrency landing. Of these, popular among users:
The Salt platform was created in 2016. She herself issues cryptocurrency loans to users. The site was developed by a small group of enthusiasts who founded Salt. After 6 years, the corporation has about 50 employees.
The service has the following features:
- Issuance of loans to ordinary users and businesses.
- Cryptocurrency credit cards.
- 24/7 customer support.
- Mobile app.
- Use of multi-signatures and cold storage.
For 2022, Salt supports 11 cryptocurrencies. Among them are some popular coins: Bitcoin, Ethereum, and Ripple.
To receive a loan from Salt, you must register an account on the platform. The second condition is the purchase of a credit package. The company provides 3 options for membership in the system:
- Participant. Term financing of up to US$10,000 is available to such system members. The loan term is from 3 to 24 months.
- Premier. Users of the platform with this status have access to good credit lines and term financing up to $100,000 in 5 fiat currencies.
- Company. Companies can apply for credit lines from Salt and take out urgent loans for more than $1 million. Fiat currency loans are available to users from a particular set of platforms.
The pros and cons of Salt are described in the table.
|Availability of 3 credit packages||Russian language is not supported|
|Digital credit cards|
|Businesses can take loans in Salt secured by cryptocurrencies|
Cryptocurrency service Celsius was launched in 2018. It was created by 2 developers – Alex and Daniel (surnames are not specified on the project website). At first, Celsius was an unpopular platform. But after 4 years, the number of active customers grew to 2 million.
- $750 million insurance fund.
- Mobile app.
- Use of zk Audit and Chainlink Proof-of-Reverse technologies.
- 4 awards in the financial field (“Best CeFi Lending Platform” and others).
By 2022, the Celsius platform will support 47 digital currencies and 1 fiat – USD. Among the available crypto assets are Bitcoin, Binance USD, and others.
You need to register in the application to take a loan from Celsius secured by cryptocurrency. Once you have created an account, you can apply for loans. The minimum amount is $100 for stablecoins and $1000 for other assets. These are shallow limits. But the average LTV is 25%. Therefore, clients must deposit reliable cryptocurrency collateral for 400% of loans.
|Mobile software (software)||Support only 1 fiat|
|Opportunity to borrow up to $100||A large amount of required collateral|
This service was launched in 2017. After 5 years, its developers remain unknown. The service automatically issues loans to users. BlockFi is not a broker. A special cryptocurrency algorithm processes all applications.
The BlockFi platform has 4 features:
- Credit cards.
- Landing history is not needed.
- Accounts with a yield of up to 8.6% per annum on deposits are available.
- Compliance with US laws.
For 2022, 6 cryptocurrencies are available to BlockFi users. Supported coins include Ethereum, Litecoin, and Bitcoin, and 3 stablecoins ( USD Coin and 2 less popular tokens).
On BlockFi, LTV is between 20% and 50%, below the average for the cryptocurrency landing page market. The minimum loan amount is $5,000. However, users can close loans ahead of schedule. The BlockFi platform does not penalize clients for this.
|Credit cards||Support for only 6 cryptocurrencies|
|Proprietary mobile software||Centralization|
|Availability of accounts for digital deposits||Low LTV|
|Favorable low rates|
This service was created in 2018. One of the leading developers is Anthony Trenchev. He created Nexo to “destroy the traditional financial system.” By 2022, the platform will be supported by more than 4 million active users from 200 countries.
- Digital cards.
- $775 million fund.
- Wallet in the Nexo system.
- Reliable mobile application.
For 2022, Nexo customers can deposit 39 different cryptocurrencies on collateral. Those available include Bitcoin, Ethereum, and other trusted digital assets.
Registered users can access loans from $50 to $2 million in more than 40 fiat currencies. Transfers of fiduciary loans to customer accounts take from 1 to 5 days. The term for sending and receiving cryptocurrency loans is less than 1 hour.
|Digital maps||Long processing times for fiat loans|
|Collateral insurance for $775 million||The complexity of mobile and browser versions|
|Opportunity to take loans from $50|
|Wallet available from Nexo developers|
|Lots of fiat currencies and crypto assets|
|LTV 90% for stablecoins|
This is a well-known ecosystem of cryptocurrency products. It was created in 2017. The head of the digital project is entrepreneur Changpeng Zhao. The Binance platform is registered in Malta. The company has licenses to conduct financial activities in many countries. One of the products of the system is a cryptocurrency lending service.
- Ecosystem. The digital platform consists of several services. The main product is a popular cryptocurrency exchange with high trading liquidity.
- Availability of reliable applications. Binance developers have created desktop and mobile software.
- Brokerage. The service offers earnings on the landing page with floating and fixed annual rates. The platform uses the funds received to issue loans to Binance customers. Investor investments also help secure margin accounts.
For 2022, the Binance lending service supports 74 cryptocurrencies. Among those available are popular coins, stablecoins, and various tokens.
Binance users have access to loans ranging from 1 week to 6 months. At the same time, the minimum LTV is 60%, and the maximum is 65%. Another liquidation rate is always 83%. Under such conditions, loans become more profitable and less risky.
|Ecosystem||Difficulty for beginners|
|High and profitable LTV||Lack of support for fiat currencies|
|Official Russian translation|
|High liquidation rate|
|Fixed low rate|
This is a reasonably well-known cryptocurrency ecosystem. It launched in 2017. Gate Technology created the site. According to various sources, the company is registered in the Cayman Islands or the United States. Gate.io does not have financial licenses. However, users trust the platform due to its high liquidity and many active clients.
Features of Gate.io:
- Ecosystem. The main product of Gate.io is a digital asset exchange.
- Availability of programs. Gate.io developers have released their applications for mobile and desktop devices.
- Mediation. The service does not issue loans to customers. He is only a broker between the parties to credit transactions. For its services, Gate.io commissions 18% from investors’ profits.
For 2022, the Gate.io lending service supports 397 virtual currencies. Loans of popular crypto assets with high liquidity are available to users.
Average LTV and liquidation levels on Gate.io are constantly changing. To calculate them, the platform considers the established cryptocurrencies’ volatility. Gate.io also provides for the landing of virtual assets for 10 days only.
|Ecosystem||Fixed short loan terms|
|Low rates||Large service fees|
|Russian language support||Collateral liquidation level volatility and LTV|
This digital ecosystem was launched in 2014. It was created by the cryptocurrency company Okx Technology Company. For 2022, the place of registration of the platform is Malta. The company has no financial licenses.
- Availability of desktop and mobile versions of the cryptocurrency platform.
For 2022, the cryptocurrency lending platform supports 120 coins and tokens. Bitcoin, Cardano, Ripple, and other popular digital assets are available to users.
Users can borrow for a period of 7 to 180 days. At the same time, the platform provides customers with a fixed high LTV of 65%. Elimination rates vary, usually 92% or 95%. There are no such landing conditions anywhere.
|Ecosystem||Lack of complete translation into Russian (part of the pages remained in English)|
|Meager loan rates||Technical support communicates only in English|
|High liquidation rate|
How to choose a platform
There are many lending cryptocurrency platforms for 2022. It is often difficult for beginners to choose between them. When searching for platforms, the following parameters should be considered:
- Several users. You must choose among the services with the maximum number of active customers. Their number at landing platforms often speaks of the popularity of sites and user confidence in them.
- Credit rate. Choosing sites with a minimum annual interest on the landing page is worth choosing. They will help you save money on loan repayments.
- Loan security level. You need to choose sites with an LTV of at least 50%. Otherwise, a cryptocurrency loan will not make sense.
- Elimination level. It affects the lending risk. The higher the level, the better.
- Borrower rating. This is an optional parameter. However, such a rating allows you to choose more responsible borrowers immediately. Otherwise, the income from the landing may be minimal.
Cryptocurrency landing is a private lending method. The method involves the issuance of loans by some investors to other investors. Brokerage services are used to conduct credit transactions.
For 2022, there are 2 types of digital landing:
- Ordinary. This type of cryptocurrency landing involves interaction with special services, such as Nexo. Often they do not use the mediation scheme and issue loans to clients themselves. Typically, such sites support fiat currencies.
- Exchange. This type of lending involves the use of popular cryptocurrency systems, such as Binance. The developers of some of these sites create services for issuing loans with an intermediary scheme. They usually provide direct loans or collect customer investments to secure margin and credit accounts. However, cryptocurrency ecosystems do not allow users to work with fiat.