Jeff Fawkes is a seasoned investment professional and a crypto analyst. He has a dual degree in Business Administration and Creative Writing and is passionate when it comes to how technology impacts our society.
Blockchain.com offers retail investors a new Borrow option that will let them ‘borrow like the big guys’, pledging their Bitcoin, Bitcoin Cash, Stellar or Ether.
Blockchain.com once was responsible for 70% of all the BTC wallets. Today, users can borrow USD (in stablecoin) and keep the precious Bitcoin for themselves. If they will pay the credited funds back after some time, of course.
Per the official announcement made on Tuesday, Blockchain.com (former Blockchain.info) offers a new borrow option within their online wallet storage. Per the official screenshots, the platform allows you to buy some USD-D with Bitcoin. Then, you can get Bitcoin back when returning the USD-D. The announcement didn’t specify what is that USD-D thing. Presumably, it is some major stablecoin, and not Tether:
“You can borrow like the big guys without ever leaving your Blockchain.com Wallet. It takes just a few clicks to go from setting up your loan to receiving your USD-denominated stablecoin. What you do from there is entirely your choice — your keys, your tokens.”
The interface allows for setting the amount that you want to borrow, as well as shows the interest rate by Blockchain, BTC/USD price, Collateral sum and the option that allows sending the Collateral from an external wallet. Previously, Blockchain has added the PAX stablecoin to its platform, so presumably, this will be one of the options in the offer.
First Time Ever a Non-Custodial Wallet Offer Lending Feature
The cryptocurrency world is not the place for borrowing money, too many scammers and shady bitcoins run within the market. For a large non-custodial online wallet service, it is possible to differentiate between shady coins and the ‘clean’ ones. All thanks to expensive Chainalysis or Crystal Blockchain subscriptions. The announce claims:
“Just as we were excited to expand the markets’ options for high-quality lending partners for institutions, today’s launch answers your demand for a reliable, trustworthy venue to borrow against your crypto holdings. This means you can increase your buying power, seize that big trading opportunity, or finance your next purchase, without selling the crypto you’ve stockpiled over the years.”
This makes a much wider circle of operations possible, including even using external wallets as Collateral sources. Retail investors gain the possibility to borrow money ‘like the big guys’, without leaving the online wallet. Per the Blockchain CEO Peter Smith:
“Institutional and retail investors have the same financial goals — grow wealth and manage risks — but the tools at their disposal are vastly different. Now, with our suite of trading products and Borrow, retail users can trade like the big guys without selling the crypto they’ve stockpiled or left their Wallet.”
Never Sell is Smart Strategy Regarding Bitcoin, Bitcoin Cash, Ether, Stellar
Why is it so important to some traders to ‘never sell’ their crypto assets? It is because, unlike fiat currency, the cryptocurrency has fixed monetary supply. It makes every satoshi more valuable over time. You cannot print, copy, steal or reproduce the coins you already spent. So, why spending them when you can use your BTC stash to raise some urgent capital and receive scarce coins back?
Last summer, Blockchain introduced its institutional lending platform, and the Borrow option is a necessary follow up. Their OTC lending desk has big partnerships across the globe. Such alliances allow the platform to lend hundreds of millions.
Also, Binance and some other ventures have a similar offer. Competition is driving crypto business progress and major acceptance. Some of the experts claim that crypto lending is the new part of a growing blockchain economy. Companies like Babel and BitGo have claimed they gave away $380 and $150 million in loans solely in March.