There’s another interesting option on the horizon for “hodlers” in the form of the YouHodler company’s new plan to offer loans backed by cryptocurrency as collateral.
Today, analysts are looking at announcements by YouHodler that soon-to-come projects may include cash loan offerings with limits up to $30,000 for crypto holders who are able to put up their coins against their receipt of new money as borrowers.
YouHodler says it will accept all major cryptocurrencies as collateral and also offers various conversions on its platform, including those involving popular crypto options such as Bitcoin, Bitcoin cash and Ripple (XRP).
Annual percentages according to recent reporting would be around 16%.
“YouHodler says it is rolling out its services in response to the crypto spring,” writes Connor Blenkinsop today at Cointelegraph (italics ours). “Over a limited time period, users are also being offered a preferential loan-to-value ratio to enable users to unlock more cash for their crypto collateral. For consumers, the platform says that “the main goal is to capitalize on this growth without having to sell current crypto assets.”
In April and May, YouHodler’s team says it plans to unveil new payment systems and add further cryptocurrencies as collateral. The platform also aspires to expand its user base and launch partnerships with traditional banking institutions so that more sustainable payment solutions are afforded to those in developing countries.
This innovation makes YouHodler the first company of its kind – with new lending options, holding large amounts of cryptocurrency may become more attractive to the average consumer.
For example, if you feel like the current home equity loan market puts a lot of restrictions on borrowers and a lot of red tape on getting some money to improve your property, you might be pleasantly surprised by going to the crypto loan market. It’s fairly reasonable to suggest that there may be less bureaucracy and hoops to jump through when you’re using a new fintech currency as collateral. Some of the myriad of regulations attached to fiat currency loans may not apply, and the process may be far more direct, depending on how these loans are set up. In general, it’s always better to have more borrowing options than fewer.
Check out this new type of financial opportunity that comes with owning significant amounts of cryptocurrency. It may be a good addition to your core strategy of holding coins in your portfolio.