No doubt you have heard of loans in cryptocurrencies. They allow the borrower to obtain short-term liquidity and the lender to earn interest on the cryptocurrencies they already own. You may have been wondering where such a loan can be taken out. In our opinion, the best platform of its kind is Binance Loans, and we will focus on that in today’s article. We will explain what loans in cryptocurrencies are and why you should use Binance, and we will present it as a real example. So let’s get started!
What are Binance Loans?
As we all know, Binance is not just a classic cryptocurrency exchange, it is an entire ecosystem consisting of dozens of different products. He is one of them Binance loans.
With this feature, you can easily get short-term liquidity because it allows you to borrow up to 65% of the value of collateral. Moreover, you can use borrowed cryptocurrencies in any way (even pull them off the platform).
So how do Binance loans differ from traditional ones?
First, cryptocurrency exchanges do not require a credit score check. To get a loan, you only need to pledge your property.
Second, traditional loans involve a significant amount of paperwork. Getting a loan from Binance, on the other hand, is quick and easy – the whole process is just a few clicks away.
Third, the interest rate on Binance loans is much lower than traditional financial institutions. Moreover, it is charged per hour, and the borrower is not penalized for early repayment.
Why take a loan on Binance Loans?
Borrowing funds at Binance brings with it a lot of benefits. Here are some of them:
Flexible conditions: Binance loans have flexible terms, and you can choose the repayment period between: 7, 14, 30, 90 or 180 days. Moreover, interest is calculated according to the actual duration of the loan (per hour) and can be paid in advance.
Possibility of early repayment: As we mentioned earlier, with Binance Loans there is the possibility of early loan repayment at no additional cost.
No restrictions: You can use the borrowed funds in any way, without restrictions. For example, you can use them to increase your positions or even retreat off the platform.
Investment: You can also use some cryptocurrencies to invest directly in Binance. In this way, you will generate passive income while reducing interest costs.
Example of using Binance credit
If you still do not fully understand the meaning of cryptocurrency commitment to borrowing cryptocurrencies, we will explain everything to you with a real life example.
Suppose Tom, a businessman, needs capital to develop his company. Admittedly, it owns 10 BTCs, but does not want to sell them at current market conditions. So he can use his bitcoins as collateral and get a loan, which he will then withdraw from the exchange and invest in the business. The best part is that Tom has to make a few mouse clicks.
How to get a loan on Binance Loans?
Borrowing funds on the Binance Loans platform is a very intuitive process, and it all comes down to just three simple steps. Here they are:
Step 1: Log in to your Binance account. If you don’t already have it, you’ll need to create it first by clicking on this link. Also, remember that you will need to pass a KYC verification to take out a loan.
Step 2: At the top of the screen, hover over “Finance” and click “Crypto Loans.” Alternatively, you can click here and go straight to the right place.
Step 3: Select the asset you want to borrow, the cryptocurrency you want to use as collateral, enter the loan amount and select the repayment period. On the right you will see all the information regarding interest, LTV, repayment amount, etc. If everything is correct, click on the yellow button “Start borrowing now” and Voilà. You just borrowed funds from Binance!