The concept of crypto lending is not overly hard to grasp. Borrowers use their crypto assets as collateral in order to acquire a loan in either fiat currency or stablecoin. Lenders, on the other hand, provide the assets that are needed for the loan at a pre-established interest rate.

 

For a lot of people, the idea of crypto lending still seems precarious and sounds too good to be true. It is understandable for someone to be wary of this relatively new concept, especially for those who still aren’t familiar with cryptocurrencies. However, several advantages come from crypto lending and loans.

 

1 – It is faster

 

When you borrow from a bank, getting approval for a loan can take a few days or even a few weeks. With cryptocurrency lending, a majority of the platforms will approve a loan within 24 hours. ID verification is usually required, but as long as you have cryptocurrency (or sometimes fiat currency) that you can deposit as collateral and government-issued ID readily available, eligibility is guaranteed.

 

2 – The fees are lower

 

The fee structures in crypto lending are clear-cut, plus they are typically lower than what you will find in traditional banking. More often than not, there is a one-time service fee, but that is all. Moreover, if you need to be paid in a different currency, you won’t be comforted with outrageous exchange rates.

 

3 – It is more accessible

 

When it comes to crypto lending, a bank account isn’t required. Furthermore, on most crypto lending platforms, your credit score will not be taken into consideration. Crypto loans have the ability to help people acquire the funds they need when traditional banks turn down their requests.

 

4 – The loan terms are more flexible

 

Cryptocurrency lending platforms are big on transparency, meaning that the terms of the loan are straightforward, and any fees are stated as clearly as possible. On the topic of flexibility, it is evident that crypto lending outshines traditional banking.

 

5 – It is safer

 

Banks are operated by people, meaning those running them are naturally fallible and don’t usually have the best security measures in place. This is especially true when it comes to technology. Cryptocurrency lending may come across as risky due to the fact that it is a digital currency and nothing more. Be that as it may, crypto lending platforms are often better than banks when it comes to security because they need to be.