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Top 5 (CeFi) Lending Platforms: How to Make Money While Holding?

One of cryptocurrency’s most underestimated potentials is lending, at least among newbies. Make Money why many people overlook the opportunities offered by lending is that returns do not match our expectations when it comes to cryptocurrencies. 

Many go into cryptocurrency because of these +100% earnings in a couple of weeks, not for 10% per year. However, remember that the stock market has traditionally been viewed as the highest-yielding asset class at 7-9% per annum. That’s why we shouldn’t lose sight of the potential earnings from cryptocurrencies.

Another reason to get serious about lending is that if you say you’re holding crypto for the long term, why not get that extra reward? 

We understand that you do not want to lend your asset if you are looking for the best selling price for your loopring price prediction, as you do not want your funds to be locked up. However, if you bought Ethereum saying that you will keep it for 10 years because you believe in it for the long term, why not earn 3 – 6 % extra annually?

In this article, we will share the top 5 centralized lending platforms. We know some of you prefer DeFi platforms, but seriously, CeFi platforms are pretty good: they offer many benefits. In addition, some may like the feeling of a safer environment (we are not told this is the case).

Before we start, we want to point out that not all of these platforms are available worldwide, so you will need to check the availability of the platform for your country before using them. 

For example, we know that YouHodler and Swissborg are completely unavailable to US customers, while Nexo is only available to customers in New York State. In addition, some of these platforms have native tokens that may not be available to US customers.

Celsius 

Celsius, founded in 2017   by Alex Mashinsky  (follow the link – he has an extremely impressive track record), is arguably one of the most famous lending platforms, with over $22 billion and over 1.4 million users. 

The Celsius platform offers lending, loans, and payments. They are also working on a credit card and exchange feature. Celsius also has business-specific features, but we’ll focus on retail use cases in this part. And on top of that, Celsius has its CEL token, but more later.

First, let’s look at lending and borrowing. When lending (you give coins to the platform) in Celsius, the amount you earn will depend on several factors:

When lending coins with Celsius, they will pay you interest based on how much they can earn by “re-loaning” your coins to institutions. 

Naturally, the interest you earn depends on the demand for certain assets and the supply. Typically, the highest interest rates are paid on stablecoins. 

Other high-interest coins currently are SNX at 14.05%, MATIC at 9.10%, and DOT at 9.02%. 

For Bitcoin and Ethereum, the rates are 6.20% up to 0.25 BTC and 3.05% for over 0.25 BTC, and for ETH, 5.35% up to 100 ETH and 3.52% over 100 ETH.

If you want to borrow cryptocurrencies (borrow from the platform), you can easily do so using the Celsius app. 

When borrowing, you can choose the loan term and interest rate. cartesi price prediction The more you collateral, the lower the interest rate, and you will also receive an additional discount on your interest rate if you pay in CEL.

Celsius also has a calculator to check everything before taking out a loan.

For example, if you wanted to borrow $1,000, one option would be to do it like this: you could borrow it with a loan term of 1 year and an interest rate of 0.75%, paying interest in CEL and stake 0.9841 ETH in as collateral (which is pretty good). 

As mentioned, Celsius is planning to offer more features, and it seems like they are trying to be a more all-in-one platform rather than focusing entirely on lending and borrowing, which is good for platform users. 

Being able to pay with the Celsius mobile app and having your credit card and exchange currency on Celsius will make it easier to decide whether to deposit cryptocurrencies on this platform.

It will be interesting to see if these other services can bring more money into Celsius, and it certainly seems more attractive to put money in there, knowing it will still be useful. 

Finally, we will briefly talk about the CEL token. The token basically works as a rewards program that gives you higher rates when you lend and lower rates when you borrow.

However, before you rush into this, you should carefully calculate everything since investing a significant part of your assets in CEL will not be profitable. The performance of CEL tokens last year is -17%, so we doubt that such higher rates can offset this.

 

Nexo 

Nexo is a subsidiary of   Credissimo, which was founded back in 2007. The Nexo platform was deployed in 2018. Nexo has paid over $200 million in interest, amassed over 2.5 million users in over 200 jurisdictions, and supports 27 different cryptocurrencies. 

Let’s start with lending. Nexo has very good rates, and almost all tokens are higher than what Celsius offers. For example, the interest on your Bitcoin and Ethereum can be as high as 8% if you choose a fixed term and get paid in Nexo tokens. 

Other interest rates are also extremely high, DOT up to 15%, and AVAX and MATIC have time-limited rate hikes of 17% and 20%, respectively. 

What distinguishes Nexo is that the interest earned is paid daily, while Celsius only pays it weekly.

When it comes to borrowing, you’ll be happy to know that interest rates can be as low as 0% in certain situations and never exceed 13.9%.

We couldn’t find exactly what interest rates look like for different situations, although they have a calculator, so it’s best to calculate everything in the calculator before doing anything. 

What caught our attention when borrowing from Nexo is that they provided an opportunity to apply for a loan against your NFTs. They currently support two collections: Crypto Punks and Bored Ape Yacht Club.

Other features of Nexo include the already mentioned payment card as well as exchange. The Nexo card is issued in partnership with Mastercard, so using it shouldn’t be a problem. The card brings you up to 2% cashback and additional benefits on the Nexo website. 

Then, to wrap up our Nexo review, we’ll take a quick look at the token. Looking at its annual performance, the outlook is much brighter than Celsius, with solid growth of over 300%. 

Because of the price movement, you will probably be much more comfortable picking levels. Nexo that are similar to those on Celsius. When you upgrade, you get benefits in all Nexo features; our favorites are higher. Lending rates and more free crypto withdrawals. As with the basic plan, you only get one.

BlockFi

Here is another platform well-known to those involved in cryptocurrency. What sets  BlockFi apart from the previous two platforms is the lack of its own currency. 

BlockFi went down the traditional path of raising money from venture capitalists and high-net-worth. Individuals when it was founded in 2017, and they’ve had several additions since then. 

In addition to the borrowing and lending features. BlockFi offers both an exchange card and a payment card. And they also have a separate side specifically for institutions.

What is disappointing after reading the review of the previous two platforms is that BlockFi. Unfortunately, only supports 13 different cryptocurrencies. We found that Nexo or Celsius outperformed BlockFi on every asset. 

 

Abandon BlockFi

However, the rate was good for some coins. So we would not completely abandon BlockFi before we read more about them.

For example, BTC and ETH rates get quite low as you increase your position (see the picture below). But BlockFi has one strong point regarding lending. This is very important to us: they can pay your interest in stablecoins. BlockFi also pays interest monthly, which again is easier to deal with.

Borrowing on BlockFi is almost the same as on other platforms, but you can get better rates elsewhere. The lowest possible rate here is 4.5%, which is quite high compared to what others are offering. 

However, BlockFi also has a calculator for borrowing and lending, so comparing it with other platforms is easy.

YouHodler 

We know the last three options were similar, and it’s time to introduce something new. YouHodler was founded in 2018 and stood out because it supports many different currencies unavailable on other platforms. 

Another difference is that they have some unique features. But they also have the disadvantage that some necessary features, such as a payment card, are missing.

Conclusion 

Before jumping to a conclusion, we just wanted to add that all these platforms are available quickly.  As mobile apps, and some are natively built for mobile devices. These are Celsius and Swissborg. So if you don’t have access to some features, you should check if they are available on their mobile app. 

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