DrawBridge Lending Creates Platform for Bitcoin Users
While cryptocurrency has made something of a splash in recent days as a great possible solution in the payment industry, it’s not without its issues. There have been multiple platforms created to cater to Bitcoin holders, and now you can add DrawBridge to the ever growing pile.
With the new program, DrawBridge is allowing lenders to use their bitcoin holdings as a stake in a “short-term non-recourse loan” valued in US dollars with rates set at 2.5 percent annual percentage yield (APY) or matching the Fed rates. DrawBridge offers its services in 45 states, currently, which means that there’s a good chance you’re on the list.
The loan terms vary, though the reports sent our way note that tenors run from one to two months to 5.5 or 6.5 months depending on the loan selected. It’s an excellent move for those concerned about monetizing their holdings rapidly, yet also concerned about volatility, which has been the hallmark of the cryptocurrency market pretty much since it got started.
Since the loans are pegged to price ceilings at the time of the loan’s maturity, the secured collateral bitcoin involved can be redeemed for cash payable to the borrower immediately. This is great if the price of bitcoin suddenly jumps.
It’s easy to think that no one’s really involved in cryptocurrency any more after bitcoin’s catastrophic meltdown over the course of 2018. And while certainly, there are a lot of people who bought at the top and took a long, long ride down, there are still plenty of HODLers that are waiting to get in. Throw in the miners and the picture only clarifies from there. While some firms have done well in the past selling cryptocurrency to convert to cash, not everyone wants to sell those cryptos to raise cash. A program like this helps miners and investors at least kind of keep their cryptos, yet still get necessary cash to cover day-to-day expenses.
So now, those looking to keep in the cryptocurrency game yet needing access to liquidity have one more option in DrawBridge. In the process, DrawBridge opens up its own potential for lending and improving its own position. It’s a win all the way around.