With the Deribit groundbreaking blockchain-based project, cryptocurrency investors can now have access to fiat loans, using their coins as collateral.

Now hodlers who need cash will no longer need to sell part of their digital assets, as they will now be able to get cash from Deribit to while depositing their cryptos.

For example, if a crypto holder needs $50K in cash, they may be required to deposit up to $125K in crypto as collateral.

However, if there is a massive price collapse, the borrower may need to add more cryptos to back the loan or reduce the loan.

The Deribit platform also has some other exciting features that make it different from other platforms, including:

Derivatives – this option helps ensure the crypto collateral against a massive price drop. In essence, both the lender and the borrower gets to benefit from the transaction.

– A lender can insure let’s say, a $50K loan due on a particular date and yielding a 14 percent annual interest, with Deribit put options. The insurance premium for loans maturing by the end of December is $1,499. The interest margin is 7.2 percent annually.

The put options are highly beneficial to the borrower as it prevents them from sending more cryptos to the lender even if the price of the collateral falls to zero.
However, the interest rate per annum could range from 15 to 17 percent per year.

For now, Deribit only accepts bitcoin collaterals, but many more coins will be added soon.
The margin call is what is still preventing the borrowers from accessing this unique system, however, with the Deribit solution, it is expected that more participants will enter the market soon.

Deribit has existed since 2016. The platform is co-owned by John Jansen, Marius Jansen, Sebastian Smyczynski and Andrew Yanovsky.

The platform started as a bitcoin futures and options trading site and has now evolved into a lending platform.

For more, visit http://www.deribit.com/
Blog: https://blog.deribit.com/
Twitter: https://twitter.com/DeribitExchange
Telegram: http://telegram.me/deribit
Email: [email protected]

The post Deribit: Giving users Fiat Loans with Cryptocurrency Collaterals appeared first on ZyCrypto.

Similar to Notcoin - TapSwap on Solana Airdrops In 2024

origin »

200 +