In the fast-evolving world of cryptocurrencies, navigating market shifts demands strategic financial tools. CoinEx Lending emerges as a flexible solution, enabling crypto enthusiasts to leverage their assets without facing liquidation.
Understanding CoinEx Lending
CoinEx Lending allows users to borrow various cryptocurrencies by pledging assets like BTC, ETH, and USDT as collateral. Notably, these assets enjoy a 100% discount rate, meaning their full market value is considered when determining loan amounts.
Competitive Edge Over Decentralized Lending Platforms
Decentralized finance (DeFi) platforms often impose collateral factors (or loan-to-value ratios) below 100%, requiring borrowers to over-collateralize loans. For example:
- A DeFi platform with an 80% collateral factor permits borrowing up to 80% of the collateral’s value.
- Minimum collateral ratios in major DeFi platforms typically range between 120%–150%, demanding higher collateral than the loan amount.
👉 Compare CoinEx’s 100% discount advantage here
CoinEx’s 100% discount rate for BTC, ETH, and USDT enables users to maximize borrowing potential without over-collateralization, offering a more efficient and user-friendly experience.
Case Study: Maximizing BTC Collateral’s Loan Potential
Scenario: Alice holds 1 BTC ($90,000) and seeks a loan using it as collateral.
CoinEx Lending:
- Collateral Value: $90,000
- Discount Rate: 100%
- Effective Collateral Value: $90,000
- Initial LTV: 80%
- Max Loan Amount: $72,000
DeFi Platform (80% Collateral Factor):
- Required Collateral for $72,000 loan: $90,000 (125% ratio)
CoinEx eliminates over-collateralization, allowing Alice to borrow up to 80% of her collateral’s value seamlessly.
Key Advantages of CoinEx Lending
1. Tiered Collateral Discount Mechanism
Adjusts discounts based on collateral risk profiles, ensuring market stability and preventing volatility—ideal for tokens with moderate market depth.
2. Loan Asset Recovery Mechanism
Pauses new loans when pools hit risk thresholds, allowing gradual recovery without forced liquidations.
3. Instant Funding & Auto-Renewal
- Funds arrive immediately post-loan initiation.
- Auto-renewal defaults on, preventing accidental liquidations.
👉 Explore seamless lending features
4. Security & Stability
- Services remain operational during technical upgrades (e.g., rebranding).
- Insurance funds cover potential losses via daily interest allocations.
5. Diverse Collateral Options
Supports multiple cryptocurrencies as collateral simultaneously for streamlined borrowing.
Conclusion
CoinEx Lending stands out by enabling efficient utilization of BTC, ETH, and USDT holdings with 100% discount rates and favorable terms. It’s a strategic choice for users seeking liquidity without DeFi’s over-collateralization complexities.
FAQs
Q1: How does CoinEx Lending’s discount rate compare to DeFi?
A1: CoinEx offers a 100% discount rate for eligible assets, unlike DeFi’s typical 80% collateral factors requiring over-collateralization.
Q2: What happens if my loan’s collateral value drops?
A2: The tiered discount and recovery mechanisms mitigate risks, pausing new loans until stability returns without sudden liquidations.
Q3: Can I use multiple cryptos as collateral for one loan?
A3: Yes! CoinEx supports diverse collateral combinations for flexible borrowing.
Q4: Is auto-renewal mandatory?
A4: Enabled by default but customizable in settings.
Q5: How quickly are borrowed funds available?
A5: Instantly upon loan approval—no waiting periods.