For many crypto investors, simply storing digital currencies in their own crypto wallet and promptly taking profits is still the method of choice. However, direct investment is by no means the only option. So-called \u201chodling\u201d is also enjoying increasing popularity. The third option in the group: lending cryptocurrencies. All three approaches have their justification, and many users deliberately rely on a combination to realize the highest possible returns with Bitcoin and Altcoins, both actively and passively. As expected, crypto loans are also not without risk. However, passive income of this kind proves to be advantageous and requires little effort if the lending takes place via reputable and secure decentralized platforms. Due to the risks, the decision to grant a loan undoubtedly requires careful consideration. The good news: Good service providers in the industry rely on fixed interest rates and guarantee lenders planning security. <\/p>\n
An important advantage is that coins and tokens on platforms remain under the control of the owners. Even owners of stablecoins such as Tether (USDT) can now \u201ctake\u201d interest income by lending on portals such as Coinloan. More and more owners of digital currencies are asking themselves whether hodling or lending cryptos is the better approach. <\/p>\n
Hodlers are those crypto owners who hold their acquired digital currencies in their crypto wallet for the long term after purchase. This can be quite effective in times of rising prices. However, the value of the portfolio only actually increases here if the prices of the currencies in question show a plus. The strategy follows the saying \u201cBuy and Hold\u201d commonly used on the stock market. However, these profits are by no means guaranteed due to the high volatility (range of fluctuation) of the crypto market. Many analysts still recommend this approach to beginners. Also because the wallet concepts of crypto portals and exchanges are becoming increasingly secure and compensation institutions are increasingly being created to protect customers against typical dangers such as hacker attacks. Holding part of your crypto assets in wallets makes perfect sense. However, many hodlers are moving towards lending portfolios at least partially via (de-)centralized platforms and thus opening up additional sources of income. <\/p>\n
The portals are advantageous in two ways: Lenders enjoy substantial interest rates. At the same time, crypto fans can also borrow capital for their own investments on the market against interest payments, even without larger assets. <\/p>\n
Lending, i.e. lending your own coins, is also rewarded with the payment of interest by the corresponding portals. Anyone who borrows crypto money pays interest in return in addition to the successive or complete repayment on a fixed date. A distinction is made between fixed, pre-defined and variable interest rates. The latter are regularly redefined. Payments are often made in the lent cryptocurrency. Payments in other cryptos or fiat money are also possible. In addition to institutional lending providers, there are DeFi services that in turn provide for automated processing based on so-called smart contracts. These portals often work on the Ethereum blockchain. Loan pools or crypto savings accounts are usually used for settlements. <\/p>\n