Cryptoloan. What is it? How to obtain one?
Today’s world is full of bureaucracy and Banks are only stimulating it. Typicall Mortgage rate is about 4%, while paying more than $1000 per month. Those high rates force people to look for new places, where they could be able to take big loan and pay not so much back. Since cryptocurrencies got popular, many people came to the conclusion, that using “digital money” is much more perspective.
The only problem of cryptocurrency loans is verification. Common bank institutions are providing a set of papers and documents, which must be filled and sent back before asking for a loan. All the documents are aimed to collect as much information about person as possible. Banks need it, because of security reasons: they are not ready to lend money to people they do not know.
Preparing papers for Banks is a tough deal. Verifying personality in “crypto bank” is much easier. Whenever crpytobank is working under KYC(know your customer), AML(anti money laundering) and CFT(combatting the financing of terrorism) it is totally ok to work with it. These requirements prove, that the project is not a SCAM and is not going to fool anyone. In compare to common banks, cryptobanks need next documents: Personal ID info. That’s it! All other verification steps are digital. SMS-verification, Voice answerback, Video-confirmation, Fingerprint-verification — no more documents needed. The only purpose cryptobanks would ask more personal info — to increase someone’s loan maximum. By providing more information anyone is also able to decrease own loan payback rates. The main difference is that there is no need to provide full info first.
On another hand, common banks lend their money, which are not in possession of a person or a group of persons. The company owns it and the company is insured by the Government. With cryptocurrency banks no one is event thinking about Government protection, because of the high volatility. Even multi token funds do not provide enough protection, but on the other side of protection are risk and possibilities. Risks cover funds completely. Even though there is a high volatility, common clients could bring more risk to the fund and investors. As LoanBit is saying in its white paper, people’s reasons to take loan are very different and that’s why LoanBit is moderating them. Investors are relieved of any SCAM or unreasonable applications, so the fund is going to stay safe as long as the project runs. Such moderation could be hostile for those, who profess the cryptocurrency ideology, but this is the only way, people could save investments and let other people loan money fast and simple, while staying at home.