This is a type of collateralized loan that allows users take advantage of market arbitrage opportunities, such as buying cryptocurrency for a lower price in repayment terms, and users are only charged interest on funds another, all within the same.
Unlike traditional loans, the loan terms for cryptocurrency can be as short as seven days and may go up to days and charge an hourly interest rate, like Binance. In other cases, you can create your own repayment schedule. The cash from the loan can be used for large payments like a down payment for a house, a vacation, refinancing debt or starting a business. Crypto lending has two components: deposits that earn interest and cryptocurrency loans. Also, if the value of your digital assets drops significantly, you may end up owing back much more than you borrowed should you default on the loan.
