Crypto Lender Celsius Drops Its Minimum Loan Request To Help Borrowers During COVID-19
The minimum loan request with Celsius Network went down to $1,000 as a result of the new coronavirus’ effects on the market. Furthermore, the loaning platform is looking to introduce the gold on gold paid out interest.
If the minimum is lowered, more Celsius users will be able to take out loans and know that their cash is secure at hand because they don’t have to sell their assets when the market is down. The CEO and founder of Celsius, Alex Mashinsky, said the minimum has been previously lowered from $3,000 to $1,500, but that with the $1,000 new minimum, users will be able to borrow smaller amounts, all without selling their crypto, even if they will have to put a collateral that’s twice the sum of the loan.
Celsius Will Work Almost as a Bank
Talking about what makes the Celsius business model different from traditional banking, Mashinsky said:
“We do the same thing as the banks, the main difference is that we give 80% back to the users while the banks keep 99%. Because we don’t have to pay dividends to the shareholders.”
He added that when it comes to volume, there are many larger borrowers that dominate Celsius’ portfolio and some of the platform’s loans exceed $10 million. Yet when it comes to sheer numbers, it seems that smaller loans are the ones making up the bulk of the loans.
There’s Also the Gold on Gold Interest
Very soon, more precisely in May, Celsius is going to introduce 2 tokens to its ecosystem, tokens that will be backed by gold: CoinShares’ (DGLD) and Tether Gold (XAUT). The users depositing these tokens will receive interest in gold. Discussing the news, Mashinsky had this to say:
“This is revolutionary, typically, with the gold you have negative yields, you have to pay the bank or another custodian for the privilege of ownership. With Celsius, not only you’ll benefit from the gold’s upside, but you’ll be earning interest in gold.”
Do Americans Need More Loaning Options?
Furthermore, Mashinsky talked about how the Federal Reserve and the US government are addressing the economic situation brought on by the coronavirus crisis. His opinion is that politicians are scared of implementing painful but necessary solutions. He also mentioned that the growth in the economy from before has been achieved by Americans borrowing money. However, this doesn’t mean they will no longer need loans.
What Else Does Celsius Have to Offer?
Celsius users can borrow US dollars or stablecoins such as USDC, USDT, TUSD, EOS and GUSD at the lowest rates in the crypto space and against their digital assets. The yearly rates start at 3.47%, not to mention users are being given the opportunity to receive big discounts if they complete monthly payments in the Celsius’ native CEL token.