Get the weekly summary of crypto market analysis, news, and forecasts! This Week’s Summary The Crypto Market ends the week at a total market capitalization of $2,120 trillion. Bitcoin is up by nearly 4% in comparison with last Sunday. Ethereum lost 2% in value over the week. XRP is down by roughly 4% after a troublesome week. Most altcoins, except Avalanche, have traded in the red for most of the week. The DeFi sector gained almost $1.4 billion from the…
In a recent announcement, Bitfinex has launched a P2P lending platform – Bitfinex Borrow. The platform will enable users to lend or borrow crypto assets in a peer-2-peer manner. Those looking to borrow can obtain a loan in either USDT or USD against their Bitcoin or Ethereum holdings as collateral.
How does it work?
The platform is currently offering two interest rate models for borrowing – Variable & Fixed Rate. On the one hand, variable-rate varies from 5.5% to 18.25% in APR (Annual Percentage Rate) depending upon the price value of the collateral, loan amount, and borrowing period. The interest rate charged for a fixed-rate loan, on the other hand, stays constant as agreed upon at the time of borrowing. However, if the loan is not repaid in the agreed-upon duration, the platform will start applying a variable rate.
Those interested in borrowing USDT or USD against their collateral will also have to maintain a minimum margin of 20% to avoid getting their position liquidated. Therefore, the platform will let you borrow only up to $12740 worth of USDT for collateral of 1 BTC ($15,800). As per the announcement, users will have first to verify themselves to access Bitfinex Borrow.
Bitfinex & controversies
With this announcement, the Hongkong-based crypto exchange has forayed into the world of DeFi (Decentralized Finance). With the massive rise earlier this year, the DeFi space is finally cooling down. The aggregated trading volume over decentralized exchanges for October has dropped drastically. However, it’s an interesting development seeing the centralized crypto sector dipping their feet in DeFi.
Especially a company like Bitfinex, that has been a part of numerous controversies over the year. The exchange was accused of Bitcoin price manipulation, running an unlicensed money transmitting business, etc. Some research even suggested Bitfinex was responsible for half of bitcoin’s price increase in late 2017 through price manipulation.