Watch out banks, loans are coming to the crypto world. A startup led by a group of top ex-PayPal employees has partnered with the Binance Incubator Ecosystem to create a powerful crypto lending platform. Libra Credit allows users to borrow fiat and crypto denominated assets by pledging Binance tokens (BNB) as collateral. Its main mission is to disrupt and revamp the current lending system, bringing loans to over 2 billion people who previously didn’t have access.
Built on the Ethereum Blockchain
When it comes to using a blockchain to create new crypto ventures, no option is more popular than the Ethereum blockchain. Due to its flexible nature, it has quickly become one of the most utilized blockchains for ICOs and crypto startups. Some of the biggest names in ICO history have started on the Ethereum blockchain – most recently EOS. The Ethereum blockchain provides companies with a safe, well tested, and easy to use platform, perfect for generating clients before launching their own mainnet.
Loans Used to Buy Cryptos
In its white paper, Libra Credit hasn’t yet outlined what money can be borrowed for. In Australia, banks have been amending their terms and conditions to stipulate that money can’t be used to buy cryptos. Seeing as its loans are in cryptos, there shouldn’t be an issue here. However, with the massive fluctuations in crypto prices, it is reasonable to suggest that loans could be very difficult to pay back if the money is spent and then the value of crypto(s) spikes. Alternatively, if the value of crypto falls while users HODL the loan amount, such person could end up having to borrow more to cover any related bills.
More Crypto Transfer Companies Launching Every Week
In addition to lending companies, more crypto transfer and payment companies are launching every week. This week TransferGo launched crypto transfers and payments on its platform and last week we saw Skrill launching its own crypto wallet. This new influx of companies that provide easier and faster access to the crypto world is great news for the community as a whole. By creating a network of easy to use and access portals into the crypto world, we edge closer to mass adoption.
For now, Libra Credit is only available in China, but it is planning to open up its services to Europe in the coming months. Crypto loans provide unique opportunities for people who were previously denied loans by banks, effectively opening up the door to fairer lending practices. It appears as if the world is slowly moving towards a decentralized future where cryptocurrencies are king – with loan services making up another piece of the puzzle.