It’s no secret that crypto lending has gone through a tumultuous 2022, with projects failing and others fighting for survival. Beyond the alarmist headlines, however, are many robust platforms that are calmly navigating the choppy waters as crypto shows resilience amid uncertainty. In this post, we’ll help you find the right crypto lending platform for you
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Disclaimer: We want to emphasize that this is not financial advice. Cryptocurrencies operate in a volatile market, where values can drastically fluctuate in a blink of an eye. It is imperative to conduct thorough research and seek guidance from a qualified financial advisor before investing.
Table Of Contents
What is Crypto Lending?
Firstly, let’s get into the nuts and bolts of crypto lending. It works in the same way as peer-to-peer lending but with crypto. For instance, you could use your crypto assets as collateral to take out loans in other crypto or fiat currency like USD. It’s a great way to liquify your digital assets without selling them.
Alternatively, you could invest by lending your crypto or USD to borrowers. Some platforms offer bank-beating, inflation-busting returns on your investments, which can be compounded daily.
The loans are usually secured by the borrower’s collateral, up to 200% of the loan value. This bypasses the need for credit checks and adds greater flexibility for all parties
In short, it’s a great way to diversify your investment portfolio.
How to Find the Best Crypto Lending Platform?
Each platform will have its own characteristics, and it’s essential to do your research. The first thing you need to do is to understand your financial goals and risk tolerance and even consider where you are.
The United States, for example, restricts a lot of features on Binance that are available in other countries.
A good basic framework could be:
Budget:
$200 per month (or $2400 one-off deposit)
Financial Goal:
To double my saving in 5 years
Risk Tolerance:
Medium (Willing to risk losing initial partial for strong gains)
Location:
United States
In terms of crypto lending platforms from an investment perspective, you’ll want to look at:
- Fees: Always make sure you understand the fee structure of each platform. Some charge for transactions, while others charge matching fees. You will likely need to pay for the service - just don’t forget to figure out how.
- Interest rates: There’s a huge variety in the APR/APY you can earn on these platforms. On one platform, you could be earning up to 15% on USDC. Others may not even support it.
- Supported currencies: This is key. If you’re not careful, you could sign up for a platform that doesn’t support your selected cryptocurrency. Save yourself hassle and headache by checking out which currencies each platform supports.
- Track record: Most crypto-lending platforms have a strong presence on social media. Check out any app or TrustPilot reviews to see how other customers rate the platforms.
Once you’ve figured out your goals and parameters, you can start to look at crypto lending platforms.
Top 3 Crypto Lending Platforms in 2022
We’ve found three crypto lending platforms that you can trust. Please note that no investment is risk-free, but these platforms do their best to mitigate the risk as much as possible.
Nexo: A Market Leader
Nexo is often the first name on the sheet for crypto lending platforms, primarily due to its high-interest rates - paid out daily. Of course, a few conditions are attached to it, such as holding on to some of its native token - NEXO, which applies only to certain cryptocurrencies.
Nonetheless, Nexo is a market leader and has recently taken a lead in reassuring customers in the latest round of crypto volatility. It appears to have a strong, self-sustaining business model.
Nexo Interest Rates
Nexo supports dozens of cryptocurrencies, including the big names and key altcoins. The interest rates vary from crypto to crypto, and it also pays higher rates if you agree to accept the interest in its native token, Nexo. Here are a few examples:
- USDT: 10% APY (12% APR in Nexo)
- BTC: 6% APY (8% APR in Nexo)
- NEAR: 8% APY (10% APR in Nexo)
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AQRU: Dependable and Solid
On the face of it, 7% APR doesn’t sound like a lot for a crypto lending platform, but there are some great features on Aqru. First, you earn interest even just by transferring crypto on its platform. Secondly, it’s designed for beginners - so if you’re new to crypto and the idea of making investments through lending, Aqru is a good place to start.
However, there are some drawbacks - it does not offer the highest interest rates and supports a limited number of cryptos.
Aqru Interest Rates
There’s no getting away from the fact that these interest rates are somewhat on the low side. However, it’s still a great product if you’re just starting out on your investment or crypto journey.
- USDC: 3% APR (7% with 90-day lock in)
- BTC: 1% APR
- ETH: 1% APR (5% with 90-day lock in)
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YouHodler: A Platform for Flexibility
Last, but by no means least, YouHodler is a crypto lending platform renowned for offering good interest rates with flexible terms. It’s also known for supporting many cryptocurrencies, including all the major stablecoins.
YouHodler does offer exchange services, but as the name suggests, the platform aims to support hodlers of crypto by providing a variety of products that helps you to earn more by holding cryptocurrencies.
YouHodler Interest Rates
The interest rates offered on this platform are competitive for crypto investors, and also supports a wide variety of cryptocurrencies with returns being paid out weekly. Here are three examples:
- USDT: 10.7% APY
- BTC: 4.7% APY
- NEAR: 8% APY
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Find Your Best Crypto Lending Platform
The three crypto lending platforms listed in this article are some of the best in the industry. They all have solid track records and offer competitive rates for investors. However, finding the right one for you means you’ll need to dig a little deeper.
Hopefully, you'll be able use our article as a basis to start your crypto earning journey today!
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