By CCN.com: CCN.com sat down recently with one of crypto’s biggest lending firms to hear insights into the emerging crypto-lending industry.

Antoni Trenchev, co-founder of Nexo, discussed the millennial mindset when borrowing, as well as upcoming trends in his field.

Lenders like Nexo, SALT, and others allow clients to borrow against their digital assets. This allows them to spend without cashing out crypto, a taxable event which requires capital gains tax payments and runs the risk of missing out on bullish upswings.

paying taxes with bitcoin so you have to pay capital gains on paying your capital gains pic.twitter.com/0xsHLo6A35 — Neeraj K. Agrawal (@NeerajKA) February 13, 2018

However, the process also runs the risk of market volatility creating a cryptocurrency price dip. A Bitcoin loan offering $0.50 on the dollar (or 2:1 collateral) allows the client to borrow $500 for $1,000 worth of Bitcoin. If the price of Bitcoin plummets, as it has often done, the client will need to back up their loan with more BTC collateral or risk the loan being liquidated, losing their staked BTC.

Crypto Winter: Weathering the Storm

Excessive liquidations would hurt the lending industry as a whole. However, Trenchev states that even throughout the crypto winter, this did not happen often. He went on to describe crypto users as surprisingly on point regarding their finances.

We got lucky, I must say. If we launched in January when Bitcoin was at $19,000, we would have experienced quite a lot of liquidations. We launched on May 1st, and then Bitcoin was already trailing much lower, so we started from a low point. You wouldn’t expect the clients in the crypto space to be so financially savvy, but they are. They structure their finances very well, they know exactly why they are borrowing, how much they should be borrowing, and with us, we’re under-leveraged by giving 50 cents on the dollar. We had very few liquidations, yes we had some, but nothing dramatic and nothing that would affect us as a company and I would like to think that 98% of our clients have not been hurt by the recent bear market.

Millennial Mindset

'72% of Millennials are placing less value on materialism, opting to spend more on experiences than physical things.' #GlobalFuturesForum pic.twitter.com/aQD55krw90 — TheFutureLaboratory (@TheFutureLab) October 12, 2016

We wanted to know exactly what people were borrowing for, and Trenchev filled us in.

We see a lot of people borrow to go on vacation, and I think this has to do with the whole millennial mindset. If you observe the retail market like clothing, consumer goods – it’s in a downtrend, the exact opposite is true with travelling, getting Ubers and AirBnBs, etc, so people are looking for real-life experiences. We see a lot of people borrow off of digital assets to buy real-life things, which is almost paradoxical!

Bitcoin Mortgages: Future Trends

Actor-Turned-Crypto Whiz Brock Pierce Buys $1.3 Million Mansion with Bitcoin https://t.co/MBxRgkNWMI — CCN.com (@CCNMarkets) April 4, 2019

As reported by CCN.com, controversial billionaire and Bitcoin entrepreneur Brock Pierce recently secured the world’s first Bitcoin mortgage through Nexo.