Binance has revealed that it has added Bitcoin Cash to its lending platform, as the competition in the cryptocurrency lending sector increases.
Users Can Now Borrow Bitcoin Cash
Bitcoin Cash holders on Binance have been given another avenue to earn interest on their cryptocurrency holdings. Binance recently revealed that it had added support for Bitcoin Cash flexible deposit on its lending platform. This cryptocurrency was added alongside Ether (ETH) and EOS.
Binance, which has been the leading cryptocurrency platform in the world, with a presence in more than 180 countries, has been expanding its services in recent months. The crypto exchange announced the expansion of interest-bearing services to the customers who hold three other leading cryptocurrencies, including BCH. Binance added BCH, EOS, and ETH to the list of supported digital currencies for flexible deposits. The addition of these three cryptocurrencies brings it up to a total of seven, as they previously backed Bitcoin (BTC), Binance Coin (BNB), and two other stablecoins.
Lending is a financial product that the platform provides to its users, allowing them to lend out their crypto assets on Binance to their Binance Margin account. As a result, they will earn interest on the assets they lend out.
The flexibility deposits on Binance is a savings account, where users have the flexibility to redeem their crypto stash without any long-term commitment but can also earn daily interests when margin traders use such funds.
According to Binance, the maximum limit of Bitcoin Cash for individuals on Binance Lending currently stands at 1,000,000 BCH. However, Binance will be adjusting maximum individual limits and interest rates on flexible accounts based on the market conditions and other factors of risk. For traders and investors who can hold such as large amount, the risk of saving the assets on a cryptocurrency exchange should be taken into consideration.
Crypto Lending Business is Getting Competitive
There is increasing competition within the cryptocurrency lending sector. The growing demand for cryptocurrency lending has seen several companies venture into offering such services.
Earlier this month, Borrow was launched by Blockchain.com, which is its crypto lending service. The product offers retail investors USD-pegged stablecoins against digital assets held in their online wallets. Borrow was immediately launched in 180 countries across the globe. Blockchain.com added that the retail users would have access to the same liquidity pool as the institutional investors using their services.
BitGo, a custody service provider, announced on the 5th of March that it has started providing institutional cryptocurrency lending services. The launch of the BitGo service comes just a few months after the private beta. According to BitGo, the lending service would be developed by a Wall Street team that fully understands the needs of institutional investors.
On that same day, March 5, the Chinese crypto lending company Babel Finance released its market outlook for the year 2020. The company pointed out that the cryptocurrency lending market is becoming more crowded due to the horizontal development strategy adopted by most of the finance players in the crypto sector. Despite the overcrowding, Babel Finance was able to record a loan balance of $380 million, as reported on February 18, 2020. This is a new high for the company, as the number of investors looking to borrow cryptocurrencies for different uses increases.
The market is likely to continue to expand, with more players providing crypto lending services. However, the cryptocurrency lending market could also increase, as both retail and institutional investors demand more digital currencies.