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…
Global peer-to-peer Bitcoin trading platform Hodl Hodl has just announced a Bitcoin-backed lending platform. With this announcement, the platform has become a true non-KYC platform for lending and borrowing cryptocurrencies. The platform has managed to bypass know-your-customer (KYC) procedures and, at the same time, not acting as a custodian.
No Custody – No KYC – No Fiat
With this announcement, the platform showcases its Hierarchy of DeFi with three main properties – No custody, No KYC, No fiat. The first being no custody, meaning the users will always be in control of their funds. The marketplace will facilitate it by locking the collateral in two-out-of-three multisig escrows. The collateral will be released from the escrow once the users pay back their loans. The second being no KYC, thus allowing users to lend or borrow with anonymity. Lastly, no fiat; hence the marketplace will operate without any involvement of fiat currencies.
The platform chose to operate without fiat currencies to combat censorship from fiat payment institutions. Therefore it only allows users to borrow stablecoins such as USDT, USDC, PAX, and DAI against Bitcoin as collateral. The company also boasts of its marketplace as truly P2P by making it zero KYC. Users only need to share their crypto address with counterparty removing the need for a credit score, identification, or banking details.
Available for US users
Hodl Hodl’s lending platform will also be available for US-based users. It’s new for DeFi platforms as most of them tend to avoid getting in trouble with US regulators. Since the ICO bubble burst, regulatory agencies tighten their grip on crypto-based platforms serving US users under the KYC and Anti-Money Laundering guidelines. Hodl Hodl, on the other hand, might slip away from the clutch of agencies as the platform won’t be holding users’ funds. Only time will tell, the regulatory agencies decide to change their approach or issue a clarification to deal with non-custodian no KYC platforms.