Should You Lend Your Bitcoin? – Crypto Lending Review

Should you lend your hard-earned cryptocurrency? For many reasons, no. But if you still want to anyway, you might as well use the best platform for doing so. I’ve tested and used 6 platforms over the last 6 months and here’s what I found.



 





*Disclaimer: This isn’t financial advice; this is purely for entertainment purposes. *



 



Timestamps:



00:00 Intro



02:55 Nexo



04:14 Crypto Lending Totals



05:22 Nexo Continued



07:20 Coinloan



09:03 Blockfi



12:10 Binance



14:52 Crypto.com & Celsius



17:01 Recommendations



19:16 Outro



 



Now I would say instead of lending, you’re better off staking your crypto natively through wallets that allow you to still own the keys. This is because when you give your crypto to any exchange or platform for lending or otherwise, they hold your cryptocurrency and the keys that access it while you do not. This means that if something were to happen, your crypto is gone and it’s not insured at all. Just ask people who used to use QuadrigaCX where their money is.



 



I say to stake natively as there are many staking platforms that are the same as lending platforms where you stake your crypto on the platform and still have the same issue. Two examples of platforms where you still have the keys and can stake are Hive and Tron.



 



I would still go as far as to say that having tested out earning passive income from crypto lending and staking for a while now, that you’re still better off to just invest in quality cryptocurrencies like Bitcoin or Ethereum in order to make a much higher return on your money than what you’d otherwise earn in interest from lending or staking.



 



With all that being said, below you will find my notes on each platform for the different caveats to be aware of and my final recommendation for a lending platform should you still choose to lend.



 



Crypt Lending Platforms Review:





  • Nexo – Nexo was decent, but they’ve had some sketchy stuff happen in the past that made me question how reliable the platform was. It was reasonable for withdrawals, KYC, and had a solid interest rate for various coins.


  • Blockfi - It has an exchange built into it unlike most lending platforms and has a decent interest rate. They also let you earn Bitcoin instead of the coin your lending which is a nice option. They do not tell you about KYC until you’ve deposited money which I find to be unethical that you’d let people deposit money without letting them know they can’t withdraw unless they fulfill their KYC obligations. A simple warning would suffice, like most of the other platforms have. Their withdrawals were also cumbersome and took the longest. In two instances, I had to re-KYC just to withdraw funds and it took days so I’m not a big fan of Blockfi.


  • Celsius – Celsius was easily the best lender for ease of use, withdrawals, and having the highest interest rates. My only gripe is that Celsius is mobile-only. Multiple lending platforms are mobile-only, but I would like to see an internet browser application too for PC users.


  • Binance – Binance is very useful and has a plethora of options for different types of lending, but without locking up your coins for many days, your interest rates are way less than anywhere else. In my case, lending DAI on Binance got me less than half of what I was getting from Celsius.


  • Coinloan – You needed a minimum deposit to start lending and you require a minimum amount to withdraw as well. In my case, I used USDC and I needed 50 USDC to withdraw so my money is now stuck on Coinloan.


  • Crypto.com – I didn’t test Crypto.com because for many cryptocurrencies you needed a large minimum deposit, for example, Ethereum lending requires at least 1 full ETH. You can’t expect people to get started with a minimum deposit of more than $1,000. Crypto.com is also a mobile-only application.


 



Overall recommendation - Don’t lend if you can help it, stake. Don’t stake if you can help it, invest in quality cryptocurrencies that are likely to go up in value, namely Bitcoin and Ethereum. If you really want to lend, your best options are Celsius if you want an easy to use platform with high interest rates or Binance if you want to get a little more technical and potentially earn even higher rates but you’ll have to lock up your cryptocurrency for a set amount of time.



 



The main stablecoins I used for lending were GUSD, PAX, USDC, TUSD, USDT, DAI, and I also tested out lending DOT on Binance as well. I wanted to maximize my gains and get a feel for the various stablecoins and how they differ during this process. The main exchanges I tested were Nexo, Blockfi, and Celsius over about a 6 month period while the rest were tested more lightly based on my experience with them.



 



Do you agree with my recommendation? Do you stake or lend cryptocurrency? Where’s your favorite place to stake or lend crypto? Am I missing any notable lending platforms in this review? Let me know what you think about this in the comments below and don’t forget to subscribe!



 



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COMMENT

20

Nathaniel GB
24 Jan

Interesting to hear of your nonbiased experiences Scott. 

I do take the risk for some of my crypto and lend to some of the choices you mention.

I personally find it 'motivating' to earn the passive income but obviously there's a bit of not your keys not your crypto involved for sure. 

Utimately, direct staking from one's wallet seems to better (although sometimes not very user friendly). 

3

Haroon Saleem
24 Jan

Interesting ti hear about your sharing Scott. Yes crypto is good and going on currency for who want to earn with patience. 

2

Julien Anthony Herimampionona
25 Jan

I'll follow you from here to publish0x. Thank you for your work and your research.

11

John Wegehaupt
25 Jan

Nice post! I like to spread out my lending portfolio between both BlockFi and Celsius.  Although just like you; I prefer staking.

I like BlockFi because they don't rely on having their own coin, and this makes me feel more confident about its future.  Also that it has backing from some of the biggest companies in the space.  Although I don't like how long it takes to withdraw and also that they only do withrawals on weekdays.

I like that Celsius generally has the highest rates, and also withdrawals are fast, easy and free! But like I mentioned above, it does worry me that they rely on having their own token.

3

Yann Poire
25 Jan

It's funny to see that all comments have been downvoted. Someone is frustrated or jealous or both...

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