BTC LENDING | Bitcointalksearch.org

HeRetiK

legendary

Activity: 3122

Merit: 2178

Playgram - The Telegram Casino

Quote from: Re.won14 on January 22, 2018, 09:34:30 AM

I have a question on this, how does lender ensure that they would get their coin back? Also for example I borrowed a loan then i tried to make a trade and unfortunately didn't succeed, how could he bounce back from this lose?

That's what the margin calls are for. Margin calls are enforced by the trading engine automatically canceling any losing positions before the balance of the margin trader reaches below zero. Short of the trading engine failing due to a software bug your coins should be safe from the lending party defaulting on you. The systemic risk of the respective exchange getting hacked or... getting "hacked"... remains of course.

Re.won14

newbie

Activity: 168

Merit: 0

Quote from: HeRetiK on January 22, 2018, 09:26:14 AM

Loan demands are made by people trading on margin, ie. borrowing coins to either short them or to use them for leveraged trading.

Loan offers is people lending coins to margin traders as mentioned above, offering them for a certain duration (at least 2 days) for a predefined interest rate (defined per day).

If your interest rate is too high, no one will take a loan from you, as you will get undercut by other market participants. If your loan offer gets accepted, you will then get a daily yield based on your preset interest rate. Your coins will get returned to you either a) after the preset duration has passed, b) the margin trader closes their position or c) the margin trader gets hit by a margin call and has thus their position liquidated.

I have a question on this, how does lender ensure that they would get their coin back? Also for example I borrowed a loan then i tried to make a trade and unfortunately didn't succeed, how could he bounce back from this lose?

HeRetiK

legendary

Activity: 3122

Merit: 2178

Playgram - The Telegram Casino

Loan demands are made by people trading on margin, ie. borrowing coins to either short them or to use them for leveraged trading.

Loan offers is people lending coins to margin traders as mentioned above, offering them for a certain duration (at least 2 days) for a predefined interest rate (defined per day).

If your interest rate is too high, no one will take a loan from you, as you will get undercut by other market participants. If your loan offer gets accepted, you will then get a daily yield based on your preset interest rate. Your coins will get returned to you either a) after the preset duration has passed, b) the margin trader closes their position or c) the margin trader gets hit by a margin call and has thus their position liquidated.

Yasceine

newbie

Activity: 9

Merit: 0

Hi,
In Poloniex, there is something called BTC Lending which has Loan Offers and Loan Demands. Can anyone explain what this means? and how can one utilize it?

Regards

Topic: BTC LENDING (Read 106 times)