Cryptocurrencies have come a long way since their inception, and today, they have become a mainstream investment asset for many individuals and businesses. While the value of cryptocurrencies can be highly volatile, they offer many benefits, such as anonymity, security, and ease of use.
However, one downside of cryptocurrencies is that they have yet to be widely accepted as collateral by traditional lenders. Fortunately, innovative fintech companies like CoinRabbit have emerged to fill this gap, offering instant crypto loans that allow users to unlock the value of their crypto holdings without selling them.
In this review, we’ll take a deep dive into CoinRabbit’s Instant Crypto Loan service, exploring its features, benefits, and drawbacks and helping you decide whether it’s the right option for you.
How does the Instant Crypto Loan Work?
CoinRabbit’s Instant Crypto Loan is a straightforward cryptocurrency lending service without credit checks, maximum loan sizes, and monthly payments that allow you to borrow crypto loans for an unlimited time with your cryptocurrency assets as collateral.
Here’s how it works:
- To start, the borrower needs to select the type and amount of cryptocurrency they want to use as collateral (borrowers can use different collateral and LTV options), then specify the payout address where they want to receive the funds, either through phone or email.
- CoinRabbit then calculates the maximum loan amount they can offer based on the current market value of the collateral. Once the borrower accepts the loan terms, they send their collateral to CoinRabbit’s secure wallet. After the collateral is verified, the loan amount is transferred to the borrower’s designated account without delays and additional checks.
- The borrower can then start spending the funds for whatever purpose they choose, with no restrictions on usage.
- The borrower has the option to pay the collateral back at any moment. To do this, they need to pay the full price of repayment. Once they do, the collateral is returned. If the borrower fails to make the payment or the token used for collateral falls by 45% relative to the borrowed token, the loan is liquidated to repay the loan.
Overall, the Instant Crypto Loan process is quick and efficient, allowing borrowers to access funds without going through traditional lending institutions.
Pros and Cons of the Instant Crypto Loan by CoinRabbit
Some of the pros and cons of the Instant Crypto Loan by CoinRabbit are:
- No lock-in periods and zero deposit and withdrawal fees – Borrowers can pay back their loans at any time without being charged any fees.
- Simple user interface – The platform is easy to navigate and allows borrowers to complete their transactions quickly.
- No KYC or personal information required – Borrowers can access loans without having to provide personal information, making the borrowing process more private.
- Responsive customer service – CoinRabbit’s customer service team is accessible and responsive to queries and issues.
- Fixed interest rates – The interest rates are fixed for the duration of the loan, allowing borrowers to plan for their repayment effectively.
- Limited currency options – CoinRabbit supports a limited number of cryptocurrencies, which may not be suitable for some borrowers.
- No support for fiat currencies – CoinRabbit only accepts cryptocurrency deposits, which could be an issue for borrowers who prefer to use fiat currencies.
- Lower interest rates – Compared to other crypto lending platforms, CoinRabbit’s interest rates are relatively low.
- No mobile app – CoinRabbit does not offer a mobile app, which could be a disadvantage for borrowers who prefer to manage their loans on the go.
Bottomline: Is the Instant Crypto Loan by Coinrabbit Worth It?
Based on the features and benefits discussed, CoinRabbit’s Instant Crypto Loan can be an excellent option for individuals looking to access funds quickly and efficiently without selling their cryptocurrency assets, especially now that we’re in the midst of a crypto winter.
However, it’s worth noting that CoinRabbit has some limitations, such as the limited selection of supported cryptocurrencies and the lack of support for fiat deposits. Also, while CoinRabbit’s interest rates (14% APR) are fixed, they are lower compared to other crypto lending platforms.
Whether CoinRabbit’s Instant Crypto Loan is worth it depends on the borrower’s specific needs and preferences. Borrowers should weigh the platform’s benefits and risks and evaluate other available options to determine if CoinRabbit is the best fit for their borrowing needs.
How is Collateral Stored with CoinRabbit?
Collateral held with CoinRabbit is stored in secure wallets that can only be accessed through a limited number of IP addresses and a VPN connection. This ensures that only authorized personnel have access to the wallets.
To provide an additional layer of security, CoinRabbit also renews the private keys for all wallets monthly. This means that even if someone were to gain unauthorized access to the wallets, they would only be able to access funds from the previous month.
How is the Collateral Amount Calculated?
The collateral amount required to be deposited is calculated based on a 50% Loan-to-Value (LTV) ratio. This means that to receive a loan, you will need to deposit digital assets worth twice the amount of the loan you are requesting. For instance, if you want to borrow $25,000 USDT, you will need to deposit digital assets worth $50,000 as collateral.
Can I take out multiple loans with CoinRabbit’s Instant Crypto Loan?
Yes, you can take out multiple loans with CoinRabbit if you have enough collateral to secure each loan. You can use your existing collateral or deposit additional cryptocurrency to take out another loan.
Each loan will have unique repayment information, interest rates, and fees, which will be specified in your loan agreement. However, it’s important to keep in mind that taking out multiple loans will increase your debt load and may put your collateral at risk. You should carefully consider your financial situation and ability to repay before taking out multiple loans.