BlockFi logo BlockFi decentralized finance

BlockFi

Supported Coins: BTC, ETH, LTC, USDC, GUSD

Loan Terms: 12 months

BlockFi is a newcomer to the lending scene but has made a big splash in the crypto community with huge backers like Perter Thiel's Valar Ventures, Winklevoss Capital, and Galaxy Digital Ventures just to name a few. BlockFi allows you to take out a loan using bitcoin, ether, or litecoin as collateral, which means you can get cash for your crypto without needing to sell it. Users can also put their crypto to work with the BlockFi interest account and earn up to 8.6% annually. Who needs a bank?!

Nexo logo Nexo decentralized finance

Nexo

Supported Coins: BTC, ETH, BNB, XRP, LTC, TRX, XLM, BCH, EOS, PAX, DASH, ADA, ETC, IOTA, XMR, NEO, OMG, QTUM, VET, ZEC, ONT, XTZ

Nexo is the only insured, licensed & regulated global finance company that lets you borrow money instantly in over 45 different currencies when you deposit your crypto assets, users even have the ability to use a Nexo debit card to spend their money. Like other decentralized finanace applications, Nexo also gives you the ability to earn up to 8% interest for lending stable coins. Nexo is trusted all over the world by the biggest players in the crypto industry and is positioned to be a leader for many years to come.

Celsius Network logo Celsius network decentralized finance

Celsius Network

Supported Coins: BTC, ETH, LTC, XRP, OMG, BCH, ZRX, XLM, DASH, TUSD, GUSD, MCDAI, PAX, USDC, USDT, TGBP, TAUD, TCAD, THKD, EOS, SGA, XAUT

Loan Terms: 6 months to 3 years

Celsius Network is decentralizing the banking sector by offering crypto-backed loans to people from countries all over the world. Offering an industry leading 9.75% interest on stable coins, Celsius gives its users a place to park their fiat-pegged crypto, bitcoin, and altcoins and pays them way more than a bank ever could, and they do this by giving up to 80% revenue share to their depositors!

xCoins logo xCoins decentralized finance

xCoins

Supported Coins: BTC

xCoins is a bitcoin lending platform where borrowers and lenders are matched together. xCoins tailors mainly to the United States where some people may need to purchase bitcoin but are restricted due to their bank or state, and would like to purchase directly via PayPal or credit card. Borrowers pay an interest fee up front when originating the loan, but since lenders can compete with each other, there will always be a fair market value for any loan.

CoinLoan logo Coinloan decentralized finance

CoinLoan

Supported Coins: BTC, ETH, TUSD, LTC, USDC, PAX, XMR, BCH, USDT, BUSD, EUR

Loan Terms: 7 days to 3 years

CoinLoan was one of the very first crypto-backed lending platforms to exist, simply lend your bitcoin and earn up to 10.3% APY that accrues daily, that interest will then be paid out once a month and can in turn earn you even more interest. Of course they also provide loans which require you to deposit crypto, the entire process is very simple and they take security very seriously so your funds will be safe, overcollateralization ensures that both borrowers and lenders will be paid out.

SALT logo SALT decentralized finance

SALT Lending

Supported Coins: BTC, BCH, ETH, DASH, LTC, TUSD, UDST, XRP

Loan Terms: 3 to 12 months

SALT Lending has been around since 2016 and has served the crypto community with a very trusted crypto-backed decentralized lending platform, with loan terms starting at $5,000 and lasting from 3 to 12 months. SALT lending belives that security should be top priority, so not only do they generate keys and sign transactions offline, but they also provide both crime insurance and cyber liability insurace for its users, one of the few DeFi companies to do so.

+ What is decentralized finance (DeFi)?

Decentralized finance is a movement to create and use financial software built with smart contracts on top of a blockchain that allows people to borrow, lend, and trade assets without the need for a traditional bank. Decentralized finance aims to remove expensive fees and interest associated with traditional banking and instead keeps it in the hands of its users. Some DeFi applications, also called DApps, run on the Ethereum blockchain and are open source.

+ Key points when choosing a DeFi platform

  • Supported countries (the ones listed on this page operate in the USA)
  • Interest earned for lending, and fees for borrowing
  • Deposit methods for purchases, if applicable (debit cards, wire, and / or crypto)
  • Supported coins for crypto-backed loans
  • Loan-to-Value ratio (LTV ratio)

+ What is Loan-to-Value ratio?

The LTV ratio is the risk that a financial institution is willing to take in order to let you borrow funds. The LTV ratio in crypto-backed loans is calculated by dividing the loan amount by the value of the crypto assets you are using as collateral, the lower the ratio, the less risk the institution is taking. For example, if a company requires an LTV ratio of 50% for a loan and you would like to borrow $5,000, then you would need to deposit at least $10,000 worth of bitcoin.

+ What are the tax implications of using DeFi?

Every country handles crypto taxation in a different way so you should familiarize yourself with crypto tax laws first. In the United States you should be on the lookout for a 1099 form from your DeFi app which shows interest paid out over the course of the year, this information can then be input into any of the most popular online tax services.