Is it good to lend bitcoins? What are the popular bitcoin lending websites?

Is it possible to earn money by lending your bitcoins? Being a bitcoin investor, have you planned whether you want to hold your bitcoin for the long term or want to make quick profits by trading bitcoin? In general, investors are of two types: those who invest for the long-term that buy and hold the asset, whereas others trade bitcoin and earn money from small price movements. Trading bitcoin can provide you ultimate profits with an increase in the value of coins, but at the same time, there are many risks involved in trading bitcoin.

The main thing is that around 90% of the traders lose their money in trading. Trading is like gambling, as both are addictive. Players try to trade their money even after losing to earn or cover up their money. Both gamblers and traders spend hours looking at price movements and analyzing the market to earn profits. Though trading is a good way to earn money, it is not effective for traders who don’t have
experience and proper knowledge about the crypto market. Know more about crypto genius as it will ease your bitcoin trading journey.

Also, at the same point in time, if you have invested in bitcoin, it is not good to store them and not to do anything to earn more money from it. Fortunately, there are some other ways to enhance your bitcoin or crypto portfolio, and that is by lending your bitcoins to earn interest in them. If you already own bitcoins or other cryptocurrencies, it is best to lend them to earn interest as passive income. Lending bitcoins doesn’t involve any risks. But learn that you need to protect your private keys.

What is Bitcoin Lending, and how does it work?

The inception of bitcoin has modernized conventional loan markets that were inactive for quite a long time. Bitcoin users don't require any bank account to lend their money. All users require is a computer or a smartphone and an internet connection. You can buy and lend bitcoins online as it is easy, fast and cheap. Earning interest on bitcoin is the same as earning interest from your savings account, and the
only difference is that instead of fiat currencies, you need to deposit bitcoins.

Say, if you want to loan your bitcoins, you loan them to a company. They will use your bitcoins to loan to corporate, retail or institutional borrowers for high interest. For your investment, you will earn more interest from borrowers instead of banks. To ensure the repayment of the loan, the company will require the borrower to present collateral for the loan. The same bitcoin services allow you to borrow or
lend money. The only risk present in lending bitcoins is liquidation, as it might be possible that the value of bitcoin drops. Lending bitcoins offer the best tax-saving opportunities. Some amazing bitcoin lending websites allow users to earn interest on their investments.

Bitcoin Lending Websites

BlockFi

BlockFi is the first and prominent bitcoin lending platform that was founded back in 2017. This platform offers users a crypto deposit account to earn compound interest. This means that monthly interest on investment will be added to the original pool, and it will continue till time you hold your cryptocurrencies. The best thing is that you can set up a free account on BlockFi, complete the KYC process and store your bitcoins in the wallet offered by BlockFi. This platform allows you to earn around 5% interest annually. BlockFi supports many cryptocurrencies, including Bitcoin, Tether, Litecoin, Ethereum, PAX and more.

YouHodler

YouHodler is a Swiss-based lending website that allows users to increase their crypto assets by holding their coins. All you need to do is deposit your crypto investment in the wallet offered by YouHodler and earn around 12% APY with payouts done weekly. This platform pays interest on cryptocurrencies, including Ethereum, Bitcoin, PAX, PAXG, HT, Ripple, etc. There are no withdrawal fees charged by the
platform and allow users to make an instant withdrawal. This platform is great for beginners as it offers a user-friendly interface and doesn’t require any minimum deposit.

Conclusion

You can earn interest on your investment as passive income. This is a great way to grow your crypto assets, but also you need to learn about the risks involved.