SALT Lending is Helping Bitcoin Millionaires Earn Interest on their Fortunes
SALT Lending is a peer-to-peer lending platform that rolled out its first loans late in 2017 after two years of development. Today, the platform is helping bitcoin millionaires earn high interest rates on their holdings.
Back in May, SALT issued $40 million in asset-backed loans aimed at investors in cryptocurrencies, allowing them to access liquidity without needing to sell off assets.
Meanwhile, this past week, The Wall Street Journal reported that SALT is helping bitcoin millionaires “unleash their fortunes.” WSJ said:
“You generally can’t pay bills or buy stocks with cryptocurrency, unless you exchange it and risk missing out on future upswings,”
“A new lending platform called SALT offers a high-interest solution.”
The WSJ explains the story of Dave Carlson, who runs a cryptocurrency mining operation in Washington State. Carlson claims he spends $250,000 per month on electricity. He needed to borrow $1 million to fund operating expenses at his mining operation, called Giga Watt. However, he didn’t want to exchange his cryptocurrency for cash today, only to miss out on a future price surge. With markets depressed as of late, Carlson was looking for another option, and he found it with SALT Lending.
SALT Lending was founded by Blake Cohen, a former real estate executive. It was Cohen’s first crypto-related endeavor.
In a statement to TechCrunch, Cohen explained that the combination of traditional, collateral-based lending with cryptocurrency was a natural fusion:
“Cryptocurrencies and blockchain assets make the ideal collateral. In typical asset-backed lending the assets need to be located, seized and liquidated for lenders to be made whole. With cryptocurrencies, all of these problems go away.”
Cryptocurrencies can be transferred instantly online and secured within a P2P lending platform. Within seconds, the borrower can access those funds, while the lender can start earning interest, with the entire transaction secured by the lending platform provider.
Today, most of the capital SALT is lending has come from the company’s own assets as well as through SALT Blockchain Asset Management, a fund with several individual limited partners. SALT is currently working with individual borrowers, although Cohen sees a future when exchanges, miners, and large tokenized startups can gain additional liquidity through collateralized loans.
“The current market cap is $400 billion, and that is totally unleveraged,”
“That is a gigantic inefficiency in the market.”
SALT offers 36 month loans. Users can receive up to 60% of the value of their cryptocurrency collateral. If you stake 10 BTC, for example, then you can withdraw $39,000 assuming a market price of $6,500 per bitcoin.
Interest rates on the loans are relatively high, ranging from 12 to 22%.
Other key features of SALT Lending include the ability to customize your loan and get verified on the same day you apply. Unlike a traditional loan, SALT Lending does not require a credit history check. If you have the cryptocurrency available to be used as collateral, then you can get a loan.
Cohen feels the company’s best days are still ahead, and that they’re only in the early stages of growth:
“Basically the money that we put in is as a proof of concept to entice the institutional capital providers to get involved with this,”
“This point is to one, demonstrate that there’s a market for this, and two, that you can do this and make risk palatable to the lender.”
In other words, Cohen feels his lending platform still has a lot of room to grow. With recent attention from The Wall Street Journal and other major media platforms, SALT Lending may continue growing to become one of the top lending platforms in the crypto space. You can learn more about SALT Lending’s blockchain-based loans today at SaltLEnding.com.