What are crypto loans? - Aliens: AI Crypto News & Markets Updates
Logo
Logo

Feed

Coins

About

Latest

Bitcoin

Ethereum

NFT

Gaming

Policy

Blockchain

Altcoins

What are crypto loans?

PublisherPublisher
Fox Business

Tue, Apr 12, 2022

Banner

Aliens TLDR

Crypto loans allow you to use your cryptocurrency as collateral to borrow cash.

If you don’t want to risk your cryptocurrency but need cash, you can consider a personal loan, which is generally unsecured and low-risk.

What is a crypto loan?

How do crypto loans work?

Pros and cons of crypto loans Crypto loan alternatives Crypto loans are secured loans that use cryptocurrency as collateral.

You can get a crypto loan for cash or a stablecoin cryptocurrency, depending on the lender.

SECURED PERSONAL LOANS: WHAT YOU NEED TO KNOW You can apply for a crypto loan at BlockFi, Celsius, Coinbase, and other cryptocurrency exchanges.

When applying for a crypto loan, you choose your payout option (USD or a stablecoin if available) and put up your cryptocurrency as collateral.

Crypto loans generally have low interest rates.

If you don’t want to tie up your crypto assets, consider a personal loan — in most cases they don’t require collateral.

Your LTV is the ratio of the loan amount to the value of your cryptocurrency collateral.

A crypto loan is also an option if you want to make a larger purchase somewhere that doesn’t accept cryptocurrency as payment.

You may have difficulty qualifying for a $50,000 personal loan , for example, but if you have at least $100,000 in cryptocurrency, you can likely get a crypto loan.

Because of that volatility, crypto loans have important benefits and drawbacks to consider: Quick funding No credit check Low interest rates No tax consequences High-risk borrowing Some lenders charge origination fees You can’t sell or trade your collateral cryptocurrency until the loan is paid off Cryptocurrency isn’t federally insured Cryptocurrency can be a high-risk investment, so it’s important to weigh all the potential advantages and disadvantages of a crypto loan before pursuing one.

If a crypto loan doesn’t fit your needs, consider these less-risky financing options: Personal loan — If you have good credit, you could qualify for a low interest rate on a personal loan .

Read full article on Aliens appRead from Original Source

The best experience is on the app

Everything happening in the crypto world, in real time

app

Recommended Stories

Article list item background

Polestar Stock News and Forecast: PSNY struggles on debut as stop-start continues

PSNY stock was brought to the market officially last week when the SPAC deal with Gores Guggenheim (GGPI) was formerly completed. GGPI stockholders ha
FX Street
·

1h

Defi

Recommended Stories

Article

Yield App partners with Unstoppable Domains to simplify crypto user experience

Article

Music Streaming Company Napster To Launch Its Own Token On Algorand

Article

Crypto Stocks, Walgreens and More Thursday Morning Movers

Article

Bitcoin's Next Support Remains at $16,000, On-Chain Data Shows

Article

Sequoia and Quona lead $6 million seed round for DeFi protocol MoHash

Article

Three Arrows Capital Caught Lying to Singapore Authorities

Article

JPEX launches CryptoPunks and REDHARE NFT Index contract

The best experience is on the app

Download app to discover exclusive content, live market updates and more.

Get smarter and richer with the Aliens Crypto Digest

Stay informed and entertained, for free.

Follow Aliens

Advertise