Owners can borrow and invest their tokens on cryptocurrency lending platforms and accrue interest on their savings. We’ll help you understand how wallets and exchanges work within this context and ensure you can invest and trade safely. Keep reading for everything you ever wanted to know about lending, saving, and borrowing cryptocurrency.
My Overview: “A cryptocurrency lending platform offered me a way to invest my idle coins. All I had to do was transfer my crypto over to start earning rewards.”
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Comparative Look Into The Best Crypto Lending Platforms: Interest Rate & Loan Term
As with fiat loan products, interest is a key metric. It’s where loan products live or die. Depositors can expect a maximum interest rate in the low tens, e.g., 12-14%. A general guide is that interest rarely ventures north of 20% or south of 10%. This should help you determine the worth of each loan threshold in our list, as it determines how much you stand to earn (or pay back).
Terms and conditions bind each loan. They may require additional checks (such as ID, a creditworthiness report, etc.), too. See below for a comparison table of the more popular cryptocurrency lending platforms, with their basic terms and staking options. It’s worth remembering that pay-back terms vary wildly, from a week to 180 days. Hourly interest rates aren’t unheard of.
Platform
Max Interest Rate
Loan Terms
- Interest Rates: Up to 20% returns
- Loan Terms: Short- and long-term options
Best Bitcoin Lending Platforms
- Easy to use, simple crypto lending platform
- Fully insured, licensed & regulated
- Buy, borrow, earn or swap crypto
- Allows customers to borrow in 45+ different currencies
- Nexo Debit Card works using Mastercard technology
- Transformative yield-generating platform
- Offers strategies for a wide range of crypto users
- Streamlined UI makes it easy for new users
- One of the premier cryptocurrency lending platforms
- Track all your cryptocurrency assets in one place with built-in portfolio
- Offers high level of insurance for stored funds
- Monitor your loan health at any time
- Earn high interest rates on individual assets with daily rewards
- Multi-asset portfolios with high yields
- Swap assets directly on platform
- Built-in Exchange
- Up to 90% Loan-to-value ratio
- Low loan minimum
- Good variety of investment options
- Mobile App for iOs and Android
- Premiere crypto-lending platform with big earning potential
- Proprietary Visa card that offers crypto cash back
- Works in conjunction with Crypto.com Exchange and Crypto.com coin CRO
- Available in USA, Europe and more
- Earn up to 10% interest for lending cryptocurrency
- You can get loans in crypto and fiat
- Great option for Europeans
- Peer-to-peer platform
- Earn interest on your BTC or USDC with no minimum balance
- Conveniently available for both Android and iOS
- Loans have no monthly payments due
- Offers proof of reserves via third-party accounting firm
- Swap between supported crypto assets for no fee
- Earn high interest on cryptocurrency with no minimum deposit
- Tiered interest rate gives even those with small amounts of crypto a high return
- Versatile cryptocurrency platform with options for earning, investing and buying crypo
- Very high-yield rates for the earn product
- Supports a variety of crypto including Bitcoin, Ethereum and USDC
- Works with over 300 institutional investors
A Roundup of the Best Bitcoin Lending Platforms
With popularity comes choice — and, sometimes, confusion. We’ve outlined the best crypto lending platforms below to help you choose the right product for your circumstances. Compare the details that matter to you:
- Nexo: Offers a secure platform and it’s range of payment options make it one of the best Bitcoin Lending platforms
- Salt: Has a simple, four-step process for obtaining a loan. There are no pre-payment fees to worry about
- YouHodler: Brovides an instant decision on loans, and offers in fifty different cryptocurrencies
- Crypto.com: Renowned for flexible repayment options, and on-chain and DeFi staking
- CoinLoan: Provider of both crypto and fiat loans that offers low interest rates.
How do Cryptocurrency Lending Platforms Work?
A crypto lending platform is an intermediary or broker between people who want to lend money and those who wish to borrow it.
A huge range of tokens are compatible with cryptocurrency lending platforms. Big-name coins, like Bitcoin, Ripple, Litecoin, and Ethereum are obvious examples. Some providers may even have native tokens for their products, which can cut costs and increase transaction efficiency.
“DeFi” or Decentralized Finance platforms work with niche coins such as Lido, EtherFi, Arbitrum, and Polygon. DeFi is another string to crypto’s digital bow, removing intermediaries and connecting lenders to borrowers directly. It’s the opposite of CeFi (Centralized Finance), which requires an exchange.
Digital tokens maintain a relationship with fiat coins. Bitcoin can be converted into US dollars, and vice versa. A select number of crypto lending platforms provide loans in fiat, but almost all crypto loans require a deposit of 100-150% in collateral before releasing any funds.
Only have fiat currency? Don’t worry. Plenty of platforms on our list have crypto exchanges without additional fees. Bitcoin is readily available at online exchanges.
Grow Your Assets Effectively: Everything You Can Do on These Platforms
Everybody has different reasons for lending, borrowing, or investing their cryptocurrency. Here are just a few:
- As a lender, you earn high rates of interest on deposits. Cryptocurrency lending platforms work similarly to traditional savings accounts.
- You can borrow cryptocurrency and immediately sell it. Known as “shorting” or “short-selling” in trading circles, the idea is to buy up an asset with a falling price, sell it, and re-buy it later to repay the loan. You keep the price difference.
- Borrowing fiat currencies with collateral means you can preserve your holdings while freeing up funds for day-to-day purchases, like utility bills or car repairs.
- Deep liquidity pools. As crypto lending platforms grow in number and popularity, so do the funds available. This doesn’t just mean that there’s lots to borrow. It means it pays for competing providers to have competitive terms.
Crypto lending platforms have only been around since the start of the current decade, yet they arguably offer as much versatility as fiat providers. For instance, collateralized loans aren’t the only products available. Lines of credit, “flash” or extremely short-term loans, and even uncollateralized options have emerged recently. The latter are still rare, however.
Can I Lend Cryptocurrency to People?
Yes. Cryptocurrency lending platforms serve a dual purpose. Firstly, to help people access loans and, secondly, to reward holders who fund those loans. Lenders earn interest on their holdings to encourage them to invest, while borrowers get agreeable repayment terms. Many crypto lending platforms support immediate reinvestment, meaning long-term rewards.
Can I Trust Cryptocurrency Lending Platforms?
Any option that risks your money invites questions about trust and legitimacy. Cryptocurrency also fluctuates in price, a trait that makes it seem like a poisoned chalice among other, more established trading options. The short answer is that scams and bad actors exist in the crypto space, just as in fiat commerce.
The good news is that the popular platforms have a reputation for user safety and regulatory backing in some jurisdictions. Consider researching a provider before parting with your crypto. Diversify your investments (use multiple crypto lending platforms) so that, in a worst-case scenario, you can recover at least some of your funds.
CeFi is more secure than DeFi. Decentralized Finance works in what’s known as a “low trust” manner to keep interference in the lending process to a minimum.
How Do Platforms Benefit from Crypto Lending?
Loan providers in the crypto space don’t work for free. Similar to traditional banks, cryptocurrency lending platforms invest your tokens behind the scenes to (hopefully) earn a profit. This is one of the uses for your collateral, although you will always be able to get your crypto back when the loan terms are fulfilled.
Let’s introduce a new concept — “staking”. Certain “proof-of-stake” coins, including Ethereum and Solana but excluding Bitcoin, can be locked into a blockchain for a set period, earning rewards until removed. Think of it like a savings account for fiat currency, accruing interest as long as funds are stashed away.
Staking is a way cryptocurrency lending platforms earn a wage. We have a page dedicated to staking for more information about this topic.
Do I Need a Wallet on a Crypto Lending Platform?
If you’re interested in cryptocurrency, you will probably already have a wallet of some description. The use of staking by loan providers lowers the need for wallets by taking the responsibility out of your hands, i.e., some crypto lending platforms will invest coins on your behalf. Again, we talk about staking beyond the link above.
Generally speaking, you will move your crypto into the platform’s wallet. This goes for lending and borrowing (remember, collateral is required for most loans).
An In-depth Look at the Most Popular Cryptocurrency Lending Platforms
Competition adds value to any industry, driving down prices while increasing quality. This includes crypto lending platforms. Here’s a rundown of popular and upcoming loan providers in the crypto space.
Crypto.com
Crypto.com is the complete package. It’s an exchange, trading, and DeFi staking platform. It’s also a card provider and an NFT (Non-Fungible Token) market. Check out its Crypto Earn facility, a product we cover in detail in our Crypto.com review. The cryptocurrency lending platform lets investors earn up to 19.07% on their spare Ethereum, Cardano, Osmosis, and tens of other coins. Payouts are sent weekly. Loans of stablecoins can be taken for one to three months at 10-12%APR. Rates vary for Bitcoin and the native token CRO.
The reviewer’s overview: “Crypto.com’s flexible repayment options meant I could pay my loan back over 12 months. They also offer on-chain and DeFi staking.”
Nexo.io
Nexo is another multi-product offering. You can get a visa card tied to your crypto — just like Crypto.com. Nexo differs from most other providers we’ve mentioned, however, as you’ll only be able to lock away your coins to accrue interest. Our Nexo review reveals the mechanics of this process. Nexo works with eighty assets and pays daily interest up to 16%. Rather than crypto loans, this crypto lending platform provides a line of credit (est. 2.9%) with the backing of token holdings. Nexo is a novel take on a still-young product.
The reviewer’s overview: “Nexo’s (near) bulletproof security and range of payment options make it a contender for the best Bitcoin lending platform.”
YouHodler
This cryptocurrency loan platform is one of the more versatile options on our list, simply because it offers funding and collateral options in up to fifty different coins. Bitcoin is one of them, alongside rarer tokens like Dogecoin, SushiSwap, and Polkadot. YouHodler boasts a “market leading” Loan-to-Value figure of 97%. It offers custom loan tariffs on request but, in general, packages start at US$100 with no maximum.
The reviewer’s overview: “YouHodler provides loans in fifty different cryptocurrencies — and I found out about my loan decision instantly.”
Salt
The key word at Salt is HODL. It provides crypto-backed loans beginning at $5,000 for 12 months, for both personal or business use. Salt claims to be the “only” lender in the space that offers stabilization. A market downturn will trigger a conversion into USDC stablecoins, protecting the customer’s assets from devaluation. Investors benefit from the Fireblocks custody management platform and cyberattack insurance.
The reviewer’s overview: “Salt had a simple, four-step process between me and my loan. There are no pre-payment fees to worry about.”
Coinloan
CoinLoan has achieved several milestones. It’s the oldest crypto lender on the market and comes fully regulated around the world. It has a diverse set of loan products that support any combination of fiat, stablecoins, and crypto. Lenders get insurance of $250m and “bank-grade” security protecting their assets. There are no early repayment fees.
The reviewer’s overview: “CoinLoan provides loans in both crypto and fiat. I managed to get a crypto-backed loan at just 5.5% APR.”
Final Verdict
Cryptocurrency lending platforms require large holdings to access loans but, with few barriers to entry for investors, they’re a (potentially) lucrative companion to any savings accounts. As always though, remember to keep your wits about you and to diversify your investments.
Frequently Asked Questions
No. The United States has no regulatory body overseeing cryptocurrency purchases, sales, or lending.
As they’re unregulated, they’re not covered by the same safeguards as bank customers. The Federal Deposit Insurance Corporation provides each person insurance of up to US$250,000 against bank failure. Reputable cryptocurrency lending platforms offer full liquidity to keep their customers’ holdings safe.
No. You will need collateral to borrow or lend money. Set up a wallet and buy the asset of your choice using fiat currency. You will then be able to sell or trade your coins.
YouHodler and Crypto.com do not require a minimum deposit. Check with each provider for guidelines.
