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If you’ve got a healthy balance in your crypto wallet but little traditional credit history, you might find it difficult to access a loan from a conventional lender.
However, there’s now a new wave of lenders that specialise in helping crypto enthusiasts use their digital assets as collateral so they can access the finance they need.
CRED is one of those providers. Formerly Libra Credit, CRED offers fiat and cryptocurrency loans backed by digital currency and aims to open access to credit anywhere, anytime.
CRED offers a decentralised lending ecosystem based on the Ethereum blockchain. Its loan products are designed to suit people whose needs are not met by a traditional bank, such as first-time borrowers, those with crypto assets and citizens of developing nations.
Here’s how a CRED loan works:
At the time of writing (October 2018), there was limited information available about the total cost of obtaining and repaying a CRED loan.
According to details provided to Finder by CRED, loan interest rates can be expected to vary between approximately 9% and 14%. However, the exact rate you receive will depend on your financial situation and loan requirements, such as the duration of the loan.
An annual administration fee also applies, but the amount of this fee is yet to be confirmed.
If you’ve compared your borrowing options and you’d like to apply for a crypto-backed loan from CRED, visit the CRED website to create an account. Once you’ve signed up with your email address and created a password, you’ll need to verify your identity by:
Once your identity has been confirmed, you can enter your collateral amount, the currency you want to borrow and your desired term to apply for a loan.
First conceived in 2017, CRED was co-founded by ex-PayPal executives Lu Hua and Dan Schatt. Initially known as Libra Credit, the company was developed with a mission to provide “credit for the real world”.
Its token sale was held in May 2018, raising more than US$26 million in funding. CRED’s desktop platform for crypto-to-crypto/fiat lending went live in Q3 2018, and the CRED mobile app is due to launch before the end of 2018.
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