Across various platforms, it’s simple to leverage your cryptocurrency assets to secure a loan. However, CoinRabbit distinguishes itself from others with its exceptional features.
This article will delve into a case study that showcases how you can reap the rewards of these appealing advantages. To bring this narrative to life, picture a dynamic marketing agency that is constantly seeking innovative ways to access funds on a daily basis.
Why do businesses and individuals take out crypto loans?
A crypto loan can be used for a wide variety of reasons, just like a legacy loan. In our story, the hypothetical marketing agency has inputs like these:
- There are a lot of orders and bills to pay, as well as active operations
- The three co-owners own approximately 10 BTC in crypto assets
- Paying the bills and keeping up with the new arrivals is urgent
- Finding ways to obtain liquidity without selling all crypto holdings
Let’s explore how these savvy marketers can effectively manage their operational expenses by utilizing an instant crypto loan from CoinRabbit.
Finding a reliable crypto lending platform is the first step
Whether you’re representing a business or acting as an individual, crypto lenders are eager to offer their services. However, it’s important to approach different lending platforms and companies with caution. Established providers like CoinRabbit have built a solid reputation in the cryptocurrency space, backed by numerous positive testimonials and success stories.To start, you might want to explore various lists of crypto lenders to broaden your options.
At this juncture, our fictional company concludes that collaborating with CoinRabbit is a prudent choice. Key advantages of centralized finance (CeFi) platforms include robust security measures and the backing of a knowledgeable team dedicated to ensuring client convenience and efficiency.
The second step is to figure out the details of the crypto loan
This is the moment for our vibrant marketing agency to carefully consider the essential metrics that will enable them to secure a loan:
Through CoinRabbit, clients have the option to use their BTC holdings as collateral. However, for those looking to diversify, the lender accommodates approximately 140 different cryptocurrencies, providing flexibility for clients to pledge any coins they possess.
CoinRabbit is happy to chase collateral starting from $100, so it jumps on this chance right away. The team decides to pledge 3 BTC as collateral for BTC loan, and retains control over the remaining 7 BTC.
Loan Amount & LTV: Notably, CoinRabbit offers a distinctive solution that allows users to borrow up to 90% of their loan value. This feature enhances your tax optimization strategies and creates additional cash flow to address immediate financial needs. In our scenario, the marketers would secure approximately 2.9 BTC, providing them with the necessary funds to manage their expenses and maintain their momentum. The loan-to-value (LTV) ratio is monitored according to the market prices of your collateral. If the price drops by more than 45%, you may need to address a potential margin call on your loan.
Unlike other lenders who impose strict loan terms and pursue monthly repayments, CoinRabbit provides loans with no time limits and no required payments. The fixed interest rate of 12% makes it straightforward to monitor repayment obligations. Borrowers have the flexibility to settle their debt and close their loan whenever they choose.
Once the specifics are established, the customer can submit their loan request to the provider.
The third step is to obtain a crypto loan and repay it
In our case study, the marketing agency utilizes the funds to manage their operational costs. However, borrowers face no limitations; they are free to pursue opportunities to earn extra profits or allocate the funds as they wish.
With the flexibility to choose when to repay both the principal and interest, users of CoinRabbit are relieved from the burden of tracking monthly payment deadlines.
CoinRabbit stands out as one of the top crypto lending platforms, allowing users to focus solely on monitoring significant fluctuations in their collateral to avoid reaching the margin call threshold.
Risks to be aware of
It is difficult to find a highly secure and trusted crypto lending platform. CoinRabbit takes care of all that by using cold wallets and ensuring compliance with security requirements.
A second piece of advice is to steer clear of liquidations, as these events are taxable and can lead to financial losses.
CoinRabbit proactively sends multiple notifications before users enter critical threat zones, ensuring that you stay informed.Additionally, CoinRabbit’s customer support team consistently monitors LTV ratios and communicates any potential risks to customers. This means clients can avoid liquidations and margin calls without needing to assign someone specifically to track loan metrics, allowing our marketing agency to concentrate on its core competencies.
By taking these precautions, the marketing agency was able to minimize potential risks while reaping the advantages of crypto loans. You too can achieve this success story—simply leverage CoinRabbit to obtain your loan.
The bottom line
CoinRabbit provides loans without set terms, streamlining the management and oversight of crypto loans far more efficiently than conventional loans. These crypto loans deliver essential liquidity while allowing users to retain their cryptocurrency assets. Given the volatility of crypto prices, users can monitor trends and respond as needed. With no credit checks required and rapid account funding, crypto loans present a compelling alternative to traditional banking options