BlockFi is a lending platform that enables users to borrow funds and use cryptocurrencies as collateral. The project is on a mission to change the trajectory of financial markets in the digital era. This non-banking entity creates debt products for owners of blockchain assets who in turn receive dollars into their accounts.
The significant strength of this platform is the ability to use one’s crypto portfolio as collateral for loans. The interest rates on the loans taken are also fair with flexible repayment plans.
The lending ecosystem on BlockFi is of high-security standards which is essential when dealing with cryptocurrencies. The platform’s operations are regulated by United States federal laws. The team that manages the network is also professional with vast experience in digital finances.
How Does BlockFi Work?
The first step is to apply for the desired amount where one is given a chance to lock down the desired terms of the loan. A response is usually delivered within a few hours after the application is received.
On approval, one sends the crypto assets to a secure address for storage. On receiving the collateral, BlockFi then credits one’s account with dollars. One is required to pay interest on a monthly basis using Bitcoin and Ethereum or fiat currency. The principle is cleared at once, and one has an option to refinance.
Benefits of BlockFi
There’s a myriad of benefits when it comes to this blockchain empowered loan facility. For individuals, the benefits are:
- Fast liquidity without disposing of one’s cryptocurrencies
- Receive tax benefits for taking a loan
- An opportunity to diversify one’s portfolio
- Invest in something more significant and still own digital currencies
- Ability to support the day to day running of the .business entity
- Make even larger crypto investments
- Gain from tax benefits of borrowing
- Diversify the firm’s balance sheet
- Systematic audit and verification by a trustworthy third party
BlockFi Terms and Conditions
The amount one qualifies for is 40% up to the value of crytpoassets used as security; 40% for BTC and 35% for ETH. The standard interest rate is 12% although the rate may vary depending on loan amount and origination fees. The maximum period of the loan is 12 months although one has the option of refinancing at the end of the credit.
BlockFi wants people and corporations grow from their crypto investments. The win-win situation is excellent for the crypto space since it’s filled with transparency, flexibility, and accuracy. Such financial features help enrich the crypto experience and validate the whole blockchain technology.