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The Best Crypto Loans Without Collateral

Confused on where to get crypto loans without collateral? Here are the best options to choose from.
crypto loans without collateral

Looking to get crypto loans without collateral? Read on as we've compiled the best collateral-free crypto lenders to get crypto loans.

Cryptocurrency has been the world's leading digital asset since its first release. According to Yahoo, Cryptocurrency and Blockchain technology company TripleA, estimates that there are now more than 300 million bitcoin users worldwide.

A great way to start off with cryptocurrency is by getting a crypto loan — the best is that, unlike bank loans, your credit score doesn't affect your eligibility for a crypto loan, but your digital asset (collateral) does.

Are there crypto loans without collateral?

Crypto loans without collateral may seem impossible at first glance, but they do exist. Are they reputable? Well, only a few are, but not all.

Every loan comes with interest, and even if you get a crypto loan without collateral from a reputable lender, they should offer higher interest rates. That's one of the major downside with such loans.

You should also be aware of the numerous scams that exist in crypto as many fall prey for free bitcoin loan scams.

Scammers will always claim to offer crypto loans without collateral with all convincing strategies, and asking you to do a little deposit to process the transaction. Once you do the deposit, you'll probably get scammed.

However, Goldfinch is one of the few crypto loans without collateral companies that focuses on credit protocol for crypto loans to real businesses.

Keep in mind that there's no crypto loan without collateral that won't require some verification from you.

Still interested to know more about companies that offer crypto loans without collateral? Read on.

That being said, we've compiled the best crypto loans without collateral options that you can choose from to get an instant crypto loan.

Table of Contents

Generalities About Crypto Loans

Decentralised finance (DeFi) has many features of traditional banking while also being accessible to those without bank accounts, which is one of its key components.

Loans are one of the services it seeks to offer, and since DeFi is a crucial component of the cryptocurrency ecosystem, it makes logical for some of those loans to be made in cryptocurrency.

The functioning of the principle is comparable to that of a traditional bank loan. The borrower must show their ability to repay the loan.

Practically speaking, this means that the borrower will eventually need to provide collateral.

Since we are discussing crypto loans, the typical form of this collateral is cryptocurrency itself.

If the loan cannot be repaid, the lending company, in this example a crypto lending network instead of a regular bank, will take the collateral in exchange for the unpaid loan.

In 2017, Compound, one of the first platforms to support crypto loans, was introduced.

Robert Leshner, a co-founder of Compound, stated at the time in a blog post: "As it stands, pretty much the only thing you can do is shift your assets out of exchanges (where they are susceptible to hacks & losses) and into your own control. In this case, wait until you are prepared to sell."

So, in principle, Compound made it possible for other networks, protocols, and organizations to provide loans in cryptocurrency.

Loans are provided through platforms like AAVE, MakerDAO, Celsius, CoinLoan, and even the contentious Binance exchange in exchange for a deposit of collateral, which is kept if you don't repay the loan.

Somebody might take out a crypto loan rather than in fiat money for a number of reasons.

First, they might not have a good enough credit history to secure the desired amount of funding.

Second, they can be a dedicated crypto fan who believes that cryptocurrency is a better investment than fiat currency

Third, they might believe that the interest rate is better for them than a conventional loan. In either case, there are advantages to taking out a crypto loan that draw in potential clients.

Also Read: Best Cryptocurrency Miner Apps and Software for Android, iOS and PC

Why Do Crypto Loan Providers Require Collateral?

Crypto loan providers require collateral for a many reasons some of which are as follows.

Collateral is used as a security deposit

Unlike traditional loans, cryptocurrency loans do not require credit checks. Instead, lenders use collateral as a security to lower their loan risk.

The collateral will be taken if a borrower is unable to pay back the amount. People with little to no credit history are able to borrow cryptocurrency thanks to this concept.

Collateral is used to calculate lending risk

Crypto loan providers may also use collateral to determine a borrower's lending risk and the terms of the loan, such as the repayment plan, interest rate, and total amount of cash available for borrowing.

The basic idea is that lenders run a reduced risk when collateral is higher.

To do this, compute the Loan-to-Value ratio (LTV). LTV is the proportion between the loan amount and the value of the collateral.

With LTV, cryptocurrency loan providers like Binance Loans may evaluate each borrower's level of lending risk while still providing loans while maintaining their business.

Risks of Crypto Loans Without Collateral

As earlier mentioned, crypto loans without collateral involve many risks some of which are as follows.

Falling prey to scams

Without credit checks or collateral, it is challenging for crypto lenders to lower lending risk. If you do manage to locate crypto loans without collateral, make sure they are not a scam by watching out for warning signs. Are you divulging sensitive information?

Have the lenders been mentioned in fraud cases in the media? The crypto loans without collateral terms seem too good to be true, don't they? Do other customers review their services?

You might find these questions helpful when confirming the legitimacy of cryptocurrency lenders.

Scam victims have occasionally had their trading accounts closed, depriving them access to their money.

Attempts by fraudsters to persuade victims into disclosing their personal information, such as account numbers and passwords, are another possibility.

Extremely high interest rates

Legitimate cryptocurrency lenders are unlikely to provide crypto loans without collateral because doing so exposes them to risk of losing money if borrowers are unable to pay back their debts.

However, some crypto lenders would agree to do so in return for exorbitantly high interest rates, lesser sums of money that can be lent, or earlier payback schedules.

These loans, however, might not be appropriate for investors wanting to expand the size of their stake through leveraged trading.

This is due to the fact that traders would have a shorter window of opportunity to make deals profitable enough to offset the high interest rates. Because of this, traders are advised against requesting non-collateral crypto loans.

How to Get Crypto Loans Without Collateral

Getting a crypto loan without collateral is a straightforward process.

When applying for a crypto loan, keep in mind that you don't need to have a credit history. So, you can apply for a crypto loan with no credit check.

It is crucial to conduct a thorough investigation before applying for a loan from a lender and to compare terms, such as interest rates, from various lenders.

After that, make sure you have all the paperwork required for verification. You may be required to undergo video verification with an agent in order to get a crypto backed loan.

The following step is to release the collateral (which is your crypto asset), to the platform after submitting all the required paperwork. You will receive your loan in fiat currency once it has been approved.

Best Crypto Loans Without Collateral Sites

Finding crypto loans without collateral is a really difficult task I have to say.

However, we've made some thorough research about no-collateral crypto loans sites and have come out with those listed below.

1. Goldfinch

Goldfinch is one of the most popular crypto loan without collateral provider.

Individuals who donate their money to the system's liquidity pools are known as liquidity providers, while people who provide capital are known as backers.

While auditors are in charge of approving borrower borrowing, borrowers use loans using off-chain collateral.

This should make it possible for anyone who wish to get a crypto loan but don't have a lot of digital assets to set as collateral.

Michael Sall and Blake West, former employees of Coinbase, founded Goldfinch in early 2021, and the protocol's coin debuted on the open market in January 2022, making GFI one of the year's most well-known new tokens.

According to a job advertisement, "the loan book has grown every two months since the protocol was announced in January 2021. We already provide services to tens of thousands of end borrowers across three continents."

2. Atlendis

Atlendis is another company that offers crypto loans without collateral.

Atlendis's website claims; "Most DeFi systems require institutional borrowers to over-collateralize their loans using cryptocurrency as collateral, restricting the wide range of use cases conceivable with crypto lending."

In order to "act as a revolving line of credit, offering borrowers flexibility for recurrent and short-term financial needs, Atlendis claims to offer cryptocurrency loans without collateral."

Atlendis's requires users to contribute to a liquidity pool in order to get a crypto loan.

The system lets lenders pick the borrowers to whom they lend their cryptocurrency, and it requires approval for borrowers to take out loans. Interest on these loans is paid at maturity.

Best Bitcoin Loan Sites

Getting a crypto loan generally requires you to have hold digital currency in you wallet which will be held by the lender as security in case you don't pay off all the debt.

However, loans involving collateral are the best option many will consider going in for because it secures both the lender and the borrower.

Here are some of the best crypto loan sites to get a crypto loan.

1. Nebeus Crypto Loans

Nebeus is an online loan company with offices in the UK and Spain. It also offers additional cryptocurrency services like trading, rental, insurance, and remittances.

Holders of cryptocurrencies can use the Flexible Loan plan to acquire a quick cash loan up to 80% of their Bitcoin worth. Your cryptocurrency holdings are the security for a loan in fiat currency.

You need 0.045818 Bitcoin as security for a $1000 loan.

You will pay a total of $1,026 over the course of a six-month repayment period with a $171 monthly payment.

If the loans are repaid before 30 days have passed, there are also no penalties for early repayment.

One can borrow as little as 0.005 Bitcoin, and the maximum amount is determined by the borrower's reputation. Nebeus doesn't have an approval procedure, hence it grants loans right away.

In just some few minutes, you can transfer a loan in EUR, USD, or GBP to any credit or debit card.

2. Nexo Crypto Loans

Founded in 2017, Nexo is a cryptocurrency exchange and fast loan platform.

The platform functions so that the borrower deposits cryptocurrency assets into his wallet and receives an immediate credit in return.

For instance, 0.0479 Bitcoin is required as security for a $1000 loan. You can either withdraw the money to your bank account or use your Nexo debit card to make purchases.

Nexo operates in more than 200 countries and has over 40 fiat currencies.

One of the first crypto lending platforms, Nexo, was the one to launch rapid crypto financing.

As collateral, you can offer BTC, BCH, BNB, ETH, LTC, XLM, XPR, NEXO tokens, and stablecoins.

You get paid in stablecoin or fiat after the loan-to-value ratio has been established.

Repaying the debt in Nexo tokens will result in a 50% interest rate discount. 5.9 percent APR is the initial rate of interest on the loans. A $50 loan can be up to $2 million.

3. SALT Lending Crypto Loans

SALT Lending was founded in 2016 in the US.  It provides both personal and business loans backed by cryptocurrencies.

When your cryptocurrency loan is authorized, you receive cash, TUSD, or USDC without any additional fees immediately into your bank account.

More than 46 US states, Canada, the UK, Switzerland, the United Arab Emirates, Hong Kong, Vietnam, Brazil, Australia, and New Zealand are now able to purchase it.

You do not have to sell your cryptocurrencies if you need money but do not have any. You can use them as security to obtain a loan through SALT Lending.

Therefore, using SALT Lending, it is possible to get a $5,000 to $12,000 cash loan with stablecoin.

The maximum loan amount is governed by the applicable laws and other limitations.

Since the site takes one's reputation into account, you do not need to have a strong credit score to be eligible for a quick cryptocurrency loan.

You might choose to pay back the loan in regular installments.

The SALT credit card is also the first cryptocurrency card that enables both cryptocurrency HODLing and cash spending.

Every time you use your SALT Card to pay for regular transactions, you also accrue cryptocurrency rewards.

4. Octabis Crypto Loans

Octabis is a crypto lending platform that offers instant crypto (bitcoin) loan no credit check.

In fact, the company let customers borrow money while preserving the value of their crypto as security.

You don't need to sign paperwork or undergo credit history checks in order to acquire quick crypto-backed loans. The procedure is online and immediate.

Octabis offers loans starting at 20 EUR and going up to 100,000 EUR. Currently, the monthly interest rate is only 1%, translating into an annual interest rate of 12%.

Additionally, by integrating the Octabis API or Octabis widget on their websites, businesses can launch their own blockchain-based crypto lending business.

5. Binance Crypto Loans

Binance is without doubt one of the leading cryptocurrency exchange platforms in the world.

Binance allows crypto lending for its customers’ crypto deposits.

You can use cryptocurrency as security for a fiat loan or a cryptocurrency loan. BTC, USDT, BUSB, BCH, XRP, and DASH are supported cryptos, whereas EUR and GBP are supported fiat currencies.

The loan's duration varies. Loan terms offered by Binance are 7, 14, 30, and 90 days.

You need 0.05363077 Bitcoin as security for a 1000 EUR loan. If you borrow money for 90 days, you'll have to pay back 1023.4 euros.

The interest is determined depending on the number of days borrowed, but you can always pay it back in advance. The loan matures two weeks after it is made.

Additionally, the annual interest rates for Tether, Binance Coin, and Ethereum Classic are 10, 15, and 7 percent, respectively.

Frequently Asked Questions

Can I get a personal loan without collateral?

Yes, but that depends on where in the world you are. Most bank loans come without any type of security. However, you must exercise caution and make sure that you will be able to make the required repayments if you wish to take out a loan.

How to get a crypto loan without collateral?

You must do your own due diligence to find a reliable lender if you want to obtain a crypto loan without collateral. After that, you must carefully study the terms and submit an application for the loan.

How much loan can I get without collateral?

It all depends on how much money you can borrow from the lender. However, you must be certain that you can repay the loan before applying for one.

Final Thoughts: Crypto Loans Without Collateral

Crypto loans are preferred over bank loans by many since approval does not rely on credit score.

Getting a crypto loan without collateral can be a very risky game as you might be ending up being a a prey of scam or end up paying higher interest rates.

While Goldfinch and Atlendis both appear to be at least relatively legitimate, there are other, less reputable, crypto loan lenders. 

Again, before applying for a crypto loan, we strongly advise you to conduct your own deep research and due diligence.

If you have to deposit off-chain collateral or contribute to a liquidity pool, there is a chance that someone will steal your money leaving you with nothing.

So be cautious, don't get greedy, and consider your options before agreeing to a collateral-free cryptocurrency loan.


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About the Author

Tebid Kelly is a Graphic Designer, Web Developer, Ethical Hacker, Programmer, and Content Creator who showcases his skills and experience on his blogs. He also has much love for finance apps such as Cash App, Venmo, PayPal, Zelle, etc on which he ha…

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