Altcoin News: Study: Cryptocurrency Loan Market Reaches Nearly $5 Billion

August 16, 2019, by Marko Vidrih on ALTCOIN MAGAZINE

The cryptocurrency company Graychain conducted a study of the loan market and it turned out that the volume of loans in cryptocurrencies exceeded $4.7 billion, but the profitability for lenders is less than 2%.

The report states that almost 100% of loans in cryptocurrencies are secured. That is, borrowers provide the lender with a pledge of some kind of asset in order to ensure repayment. However, researcher Robert Walker Cohen believes this practice will change in the near future.

“The number of loans originated grew faster than new addresses and the total origination amount. That means that people are making more small loans, rather than borrowing millions at a time. This suggests adoption (on the public platforms) by more average consumers, rather than institutional borrowers,” explained Cohen.

The data collected by Graychain was obtained from open blockchains, including MakerDAO, Compund, dYdX and Nuo, as well as from open sources, press releases and so on.

“We started with what we had, used approximations for any missing data, and summed the results,” the report said.

Note that over the past 18 months, 244,000 loans were issued, while 65% of the market is served by startups Celsius and Genesis. It was previously reported that only Genesis Global Trading issued loans of $425 million for the first quarter of 2019.

Author: Marko Vidrih