Loans in Cryptocurrency? How Safe and Real They Are


Cryptocurrencies have rapidly gained popularity for past 2 years. The mining has become a profitable business and the bitcoin rate has exceeded $20 000. However, such rise has been followed by the fall, which discouraged investors. Now clients reflect on the practicality of gaining a loan in cryptocurrency and on risks connected with it.

Borrowing of funds

It is real to gain some funds but a limited number of institutions issue them. It is primarily connected with the fact that not everyone has an access to cryptocurrency. Certainly, the major risk relates to the unstable rate that can decrease by more than 1/3 of its value for one day.

Analysts’ views diverge, as some experts treat the cryptocurrency with enthusiasm but others consider it as no more than a fiction. The terms for obtaining loans are similar to gaining a cash loan or an amount transferred to the card: it is only necessary to explain your goals and provide identity documents.

Creditors prefer issuing large funds in bitcoin to reduce the risk. Small loans are almost not essential in this market segment.

Development prospects

Loans in cryptocurrency have many disadvantages: For example:

  1. Unstable rate.
  2. Necessity to pay back the funds in the same way (all institutions issuing loans notify of paybacks in cryptocurrency).
  3. Low liquidity.

The market is dynamically changing and accommodating to the new financial environment, so gaining necessary funds are not a fiction anymore. However, now creditors face users’ distrust in the new system. The uncertainty about cryptocurrencies and the risk of their ban are considerable obstacles to the loan market development.

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