Bitcoin lending list companies where you can lend your bitcoins. We have tried BitBond, BTCjam and Bitlendingclub. We tested these sites 2014-2107 and we are not satisfied with the results. In conclusion, the summaries are confusing and the net result is negative. We recommend margin lending with Bitfinex or Poloniex. Also, we recommend cloud mining with Genesis Mining or Hashflare.
Bitcoin Margin Funding
Bitcoin margin funding is a form of peer to peer Bitcoin lending. You lend your Bitcoin to margin traders. Margin traders use the funds to trade with leverage. To get the leverage they need to lend money which is done in a peer to peer manner. The funds are secured by automatic liquidation at certain levels. We have never experienced any loss and never heard of it either.
Peer-to-peer lending by Bitcoin means that many people lend small amounts to a borrower. However, we have experienced that it´s very hard to make proper controls of the borrower. The lending is often over borders and in many different countries which make it hard to control ID´s and paybacks. Also, many loans are in USD which and not in BTC. This is good if BTC decreases in value but not if BTC increases in value.
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Peer-to-peer lending as passive income
Peer-to-peer lending is a very good choice for a passive income. All lending companies listed have an auto function that can make the investments for you. You can choose predetermined criteria and then it´s a self-going bot. Peer-to-peer lending is possible with Bitcoin, Litecoin and USD.
Bitcoin Lending on Bitcoin Exchanges
The bitcoin exchanges which have margin trading offers Bitcoin lending. Traders use leverage and consequential they need borrowing money. Leverage is when you hold a position worth $100 but only use $20 of you money. This is 5x leverage. As a result, the trader needs to borrow $80 from somewhere. You can supply liquidity with your money and earn interest. This is also called peer-to-peer lending. See our bitcoin exchange reviews. The exchanges with this service are Bitfinex and Poloniex.
Bitcoin Lending companies
BTCjam, Bitbond, Bitlendingclub and BTCpop are pure bitcoin lending companies. This is their main feature. These companies are platforms that connect lenders and borrowers. The loan purposes are very diverse but all loans are defined. All borrowers and lenders also have a profile.
Bitcoin Lending risks
Bitcoin lending as investment involves certain risks. To clarify, any type of investment involves certain risks, so this is normal. For the most part, the risk is usually comparable with the return. If there is a big upside there is also a deep downside. Bitcoin lending we would say is a medium risk investment. The biggest risk you take is to loose your money. You can never lose more than invested. This will happen if your borrower can´t pay back the loan. In the long run, the best solution for this problem is to spread the lending to many borrowers. This is perfect for bitcoin since you can make micro transactions almost for free. To sum up, always remember to diversify your investments.