Unfortunately the price of bitcoins is super volatile and therefore I think loans could prove bad for both the giver and taker .
Take for example the loan is given by someone and bitcoins suddenly flew to 10* times the price of the time he gave the loan at , now I could only imagine the situation the person who gave the loan would be in.
I think Its a really bad idea , also if you take loan in money and then convert it into bitcoins you could loose everything or maybe gain a lot..
No one knows , this is scary .
Topic: How would loans work in a Bitcoin economy - page 5. (Read 1041 times)
first of all i dont consider bitcoin as banks because to me bitcoin is a currency or a payment method .
second , i dont know why people call it a bank , maybe because you can earn thru it thru investing or what ?
third , there are service that make bitcoin loans .
last , there are also third party bitcoin investments were you put them your btc and these investment company are being controlled and managed someone and they can either use your money to lend or to gamble .
second , i dont know why people call it a bank , maybe because you can earn thru it thru investing or what ?
third , there are service that make bitcoin loans .
last , there are also third party bitcoin investments were you put them your btc and these investment company are being controlled and managed someone and they can either use your money to lend or to gamble .
We don't have Bitcoin banks that would provide crypto loans and other services but there are some platforms that provide Bitcoin loans. Even here on forum you can get them.
But Bitcoin loans could be very risky becase of volatility so if you don't have some income source in Bitcoin at the end you might find yourself in situation that you need to return much more than you have borrowed. Of course the amount in Bitcoin will be the same but if you have to spend fiat to return Bitcoin loan that is bad.
But Bitcoin loans could be very risky becase of volatility so if you don't have some income source in Bitcoin at the end you might find yourself in situation that you need to return much more than you have borrowed. Of course the amount in Bitcoin will be the same but if you have to spend fiat to return Bitcoin loan that is bad.
There will crop up new banks holding btc which will loan these out.
there wouldn’t be anyone to give out traditional loans
Well, @DarkStar_ did itYou can also apply for loans from different users here in this forum.
My question is where would people go to get loans in a Bitcoin economy and how might those loans work?
It's the same as loans in the real world economy, basically (1) collateral loan and (2) non-collateral loan.Both require interest to incentivize loan providers.
What would be the difference of fiat loaning from crypto or bitcoin?
But my curiosity too is that, how will the value be quantified because of bitcoin fluctuations. We know that when price fluctuate, either a coin goes higher or lower.
Hello everyone,,
To my understanding people deposit money into banks and the banks use that money to give out loans. But with Bitcoin everyone is essentially their own bank, meaning there wouldn’t be anyone to give out traditional loans. My question is where would people go to get loans in a Bitcoin economy and how might those loans work?
If so, then the inter-bank loan is enforced, bank A ownership of person A gives a loan to bank B ownership of person B and vice versa, because as you said everyone who has a bitcoin wallet is their own bank. So, the loan can still be done in my opinion and the most important thing is the existence of an agreement about the rate that is always changing. To my understanding people deposit money into banks and the banks use that money to give out loans. But with Bitcoin everyone is essentially their own bank, meaning there wouldn’t be anyone to give out traditional loans. My question is where would people go to get loans in a Bitcoin economy and how might those loans work?
Loans are indeed difficult in the bitcoin community specially if we just know each other online. If I the lender then I might want something that is secure.
I don't see it being that difficult to be honest-- we have years of evidence that the lending aspect on this forum has been thriving really well-- so well that due to the competition the interest rates here are very low.It's probably not very rewarding, but at least it's a convenient form of semi-passive income and people with sufficient collateral benefit in the way that they get the best possible deal in form of lower interest rates.
The lenders on this forum have proven to provide better quality loans than banks have done in the last decades. It can work in a honest way, unlike banks that keep extorting people even far after they ended up broke.
Some of them ask for collateral and some don't.It depends on what you can guarantee that you can repay.
If you don't ask for collateral when lending either crypto or fiat, you're asking for trouble. It's just way too easy for someone to run away with the money if they don't provide collateral for a loan, and I've seen it happen many times.Banks haven't really gotten involved in bitcoin or any other crypto in any meaningful way, but I suspect that they'd follow the same procedures as any other loan if they did start lending cryptocurrencies (and I don't think they will, since very few people accept it in general). Banks are risk-averse and there's no way they'd make a loan to someone with a irreversible currency without getting collateral from them. I'm not sure why lenders on this forum give out no-collateral loans, because they're extremely risky. You don't know if someone has bought an account here, and reputation in the form of a trust score is next to meaningless. I learned that the hard way a few years ago.
I think there must be a legitimate and trustworthy agency under government law to provide loans and submit collateral value above the loan. therefore if bitcoin is legalized by the state, of course banks will not lose their role, because there will be many problems if borrowing between personal
It will work out the loans in the Bitcoin economy base on the account status of the one who wants to apply for loan. The higher the ranks the more chances to be accepted and of course the contract has done through collateral basis.
This applies for the loan application inside the forum on the Lending section. There are websites that are giving this service but I haven't used any of them.Like this website: https://nexo.io/instant-crypto-loans
This is the website that I can suggest for now because I've seen that they've been advertising in many platforms.
PS: I haven't used nexo.
Loans are easy, but getting your coins back if someone forfeit repayments might be a complex story. Bitcoin is borderless and you can loan money to anyone in the world, but each country has it's own laws and they are there to protect their citizens.
People use Escrow services as a third party to execute the loan, but not all Escrow services are legitimate.. so you have to get reputable Escrow services to protect your transaction.
Also remember, Bank are not just loaning people other people's deposits... they loan money that they get from Reserve Banks.
People use Escrow services as a third party to execute the loan, but not all Escrow services are legitimate.. so you have to get reputable Escrow services to protect your transaction.
Also remember, Bank are not just loaning people other people's deposits... they loan money that they get from Reserve Banks.
Loaning bitcoin requires a collateral because its decentralize in nature and its hard to have a trust on the people here. On the part of the borrower, its not advisable that they will loan on the form of cryptocurrency because of its volatility. Cash is still the best.
What would be the difference of fiat loaning from crypto or bitcoin? I think that will be the same. People would think, that is dangerous since you will be loaning a money from someone you don't know but obviously there will be a requirements, a third person where they will sign the agreement. As far as I know there is a thread here about that.
Edit : the link is already posted here.
Edit : the link is already posted here.
It is actually just the same as banks.
They will need all your information so they could do something if you run away.
A guarantee is need and that means giving a collateral. What can you offer?
Loans are indeed difficult in the bitcoin community specially if we just know each other online. If I the lender then I might want something that is secure.
They will need all your information so they could do something if you run away.
A guarantee is need and that means giving a collateral. What can you offer?
Loans are indeed difficult in the bitcoin community specially if we just know each other online. If I the lender then I might want something that is secure.
If the holder of bitcoin is the bank itself, you can still borrow between banks, just like a real bank they also make loans if deemed necessary. So you can borrow between bitcoin holders, but clearly you have to give a guarantee unless you are already trusted.
This is the importance of collateral in bitcoin loans, I think if the borrower gives a collateral of equal worth or above, this is not a problem. Therefore most moneylenders will not receive a loan if the borrower does not provide collateral and may be without collateral if the borrower feels trusted.
I don't think Bitcoin will be good for loan because investor of Bitcoin monitor it every day to make sure it grow and if anyone give Bitcoin as loan he or she will expect double from the person that collected the loan, and there is a risk of not paying back because u are your own bank, which means if you don't have power the person might run away with you Bitcoin
This is the importance of collateral in bitcoin loans, I think if the borrower gives a collateral of equal worth or above, this is not a problem. Therefore most moneylenders will not receive a loan if the borrower does not provide collateral and may be without collateral if the borrower feels trusted.
It will work out the loans in the Bitcoin economy base on the account status of the one who wants to apply for loan. The higher the ranks the more chances to be accepted and of course the contract has done through collateral basis.
But with Bitcoin everyone is essentially their own bank, meaning there wouldn’t be anyone to give out traditional loans.
Nope, it doesn't mean that.
It means simply you store your money in your own wallet, safely and secure without having to rely on a bank for this.
You don't need a bank account anymore to deposit your wage, you don't need a card and an account, all you need is a wallet.
But that doesn't mean banks will be gone.
There will be still people needing loans, people looking for investments and banks do a lot more things that storing your money and doing wire transfers.
So loans will just go on the same as before.
My question is where would people go to get loans in a Bitcoin economy and how might those loans work?
Banks, Loans business, there are plenty right now and there would be plenty even in a bitcoin only world, and they will work the same as now.
Loans keep the people poor so better to have no loans than traditional loans from banks because they were printing more money to give loans for the people who were asking so the value keep decreasing when the people debts increases.
Nope, stupidity when taking a loan and stupidity when blowing all that money away is what keeps people poor.
But, if you plan on living with your parents till you're 50 and you finally have saved enough to buy a home with no mortgage, it's your choice!
I don't think Bitcoin will be good for loan because investor of Bitcoin monitor it every day to make sure it grow and if anyone give Bitcoin as loan he or she will expect double from the person that collected the loan, and there is a risk of not paying back because u are your own bank, which means if you don't have power the person might run away with you Bitcoin
We can have loans in bitcoin, only if there is a contract between the two sides. As bitcoin is a decentralized currency and there is no company or bank governing bitcoin, I think that's impossible. Another problem is bitcoin volatility. The value of bitcoins will differ when you want to pay back.
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