Bitcoin Forum

Why is some people doing that? I mean what do they win by lending bitcoins to anyone without a collateral, are they just trying to farm trust? Even if they are its still pretty stupid since you could get trust lending with collateral aswell, am i missing something?

Some people just trust that other members will pay back what they borrow.
Personally i have had 2 loan without any collateral and always paid back, just because i dont have anything of real value to loose my rep here is more important to me than a few coins and i don't want to loose it.
Im a man of my word so if another member is nice enough to lent me some BTC when needed i will always do the right thing and pay it back.
With that said if your new and ask for a loan without collateral you will open yourself up to neg rep by other members.

As for what does the lender have to win by lendind without collateral, easy, its called interest, which is often higher without collateral due to the risks involved.

Yes the interest may be higher but when someone fails to pay 0.01 it destroys all your interest from 5 previous loans

People get % from every loan thats how they profit from loans
Also mostly full members and higher rank get loans,other lower ranks never receive

Yes but the % is low, 5-15% and when someone fails to return the loan you lose 100% so i dont see how it is profitable

Basically farming trust at all costs as far as I can see. It's a bit like paying for trust... The thing is, it's not really profitable haha :)

Yeah and you can farm trust using collateral anyways and its more safe that way

Some people probably doesn't have anything right now but urgently need some bitcoins.

While joining a signature campaign at bitcointalk, I could pay back what I borrow. But if I use my account as collateral, It's hard to get bitcoin here (Or I'm the one who lazy :P ) and I didn't have anything else on internet that can I use as collateral.

Some people really need them, unfortunately those scammer exploiting it.
Good things there still kind peoples here.

Building trust is hard, destroying them is easier

yes but why would an sr.member risk his account for 0.10 btc or something like that
because his account is much more worth,why should he get negative trust for such a small loan
maybe if it was 1 btc or something then it would be ok

I have at the moment offer two loans here on bitcointalk(i use many platforms for lending) one is 0.06 which i didn't take a collateral for that and one is for 0.015 which offered me as a collateral an amazon account with 4$ coupon in, wich i only check and gave it back to the owner..
First loan will pay me on 28 March and the other have contact me and said that will send the payment wich i am expecting today..why i did that without take any collateral? i want to make a trust cycle between us i have take a look on their accounts and it seem good for me to lend them but we will see in the end.When i will decide if i start offering mostly micro loans here i am going to have both options collateral for small accounts and without on those it will give me a sign of trust so finally with time i can be in a position to make a trust cycle here.
Now if i loose some it is on the game, it wont be first time and i am not regret it special for those small amounts but i will feel sad for trust those who disappoint me..In some words i prefer honesty between collateral, paid loans and failed ones.

Kind Regards,
BTC-Bank.

I thought they are shills and have many alt accounts. But they will never take a risk if it's their main account. AFAIK, most of them who defaulted loan are alt accounts, they need fast money, then they decided to taking loan than sell their account.

maybe they are alts,but i dont think someone would give a loan to a lower rank,also people check if there are open loans
on any of the accounts they want to buy

But its not only if they plan to scam, maybe they just cant pay the loan back because they lost their money and they really cant pay it back.

The thing is that you should always ask for collateral and escrow is the best and safest way

Loaning without collateral is a big mistake. I understand a loan between friends but don't ever consider loaning a gambler. You will hear 1000 excuses before you ever see your coin back. Loaning is -EV.

That's just the risk they are willing to take. Personally I don't get why people bother lending money as you're going to get scammed at some point if you don't take collateral but for the tiny percent they make in fees it doesn't seem worth it as like you said one bad loan and you lose out big time. I think the best colleteral is probably a bitcointalk account but only lend half of its worth. People then have incentive to return the money but if they don't you've made a decent profit when you sell it on.

I think probably the majority of loans taken out are done just to build rep or feedback. Why do people really need to borrow tiny little amounts of btc otherwise? The only thing I can think of is gambling but thats a quick way to lose all your money as most people don't win in the long run.

yes for gambling, like 90% of people who take loans here are using them for gambling because as you said what would you use that tiny amount of money for.

they are simply gambling their coins with much risk less payout :(

Not if you loan carefully ;)

Loaning carefully would be loaning with collateral, if you loan with collateral you are pretty much 100% safe but without it? Even if you are extremely careful, just 1 bad loan and it fucks up everything

Not if you give out 100s of loans to the correct people (those with background/trust on the forums).

It is quite insane to see that there are actually people in this forum who are lending without collateral.
Lenders should require something pledged as security for repayment of any loan, which will be forfeited in the event of a default.

if i had quite a lot of bitcoin and opened the thread loans without collateral, of course before giving a loan i'll check first and probably only give loans to the user with a nice background ..
but of course better to use collateral for safer

Yes but there are not many really trusted members and those who arent will probably dont need loans, like in the lending section mostly newbies are searching for loans, most of them to scam. I was planning on giving some loans, i have 0.4 but only with collateral even trusted members

if collateral is their account make sure that the value of the loan below the price of the account
well... goodluck

Lending without a collateral is very similar to gambling.

This is true @raderhamart and let me say that the chances on gambling it is quite better!I am already burn 2 on 2 here...But i will keep try to lend without collateral but i will be a lot more caution this time about the History and trustworthy of the member.

Kind Regards,
BTC-Bank.

People are selling forum accounts - so trust on the forums doesn't  mean much. Any reliable user will be able to provide a collateral.

Yes thats pretty much the problem with trust unless its someone really trusted and famous like dooglus, i would trust dooglus of course but normal users can just buy accounts or trust

I don't mind lending with no collateral.  It's a individuals choice.

Myself, I've taken out a couple loans in which I did not provide collateral. For one, the loan size were relatively small. Two, I didn't have any collateral. If a lender feels the reward through interest of the loan outweighs the risk of defaulting on the loan, then a lender will fulfill the request in hopes of making a decent return. Others take advantage and either farm trust, or flat out default on the loan.

You can also loan carefully...you just gotta check the user his trust his posts etc and if you see something suspective then you deny them the loan.

What if they bought the account? Maybe they bought it some time ago with positive trust and BOOM you get fucked, thats why always collateral is the way to go.

I want to borrow 5 btc, will pay back 6 btc in 10 days.

Pm me for details.

You can see if that trust is recent or not...also you can see difference in person's writing style before and after buy. You always gotta research before lending.

I have no idea why anyone would do this, but I guess people just have faith in humanity.
Personally I have never seen anyone take this risk.

I currently have loans total over 5BTC without any collateral on my lending thread (check my personal message).

its not that easy to get a loan. usually they extensively analyze ur post history to know who they are dealing with.

It's just like any other business. Some people are skilled at picking and choosing who to loan to. Those people can make good money. Other people aren't so good at choosing the right lending opportunities. They either barely scrape by or they go broke.

The thing is that you cant know if someone is going to pay back even if they are legit and they are willing to pay back at first they may encounter some sort of problem and they wont be able to pay back, what are you going to do then, since you didnt want a collateral

That's true everywhere. Not just in the Bitcoin world. I have a number of credit cards in my wallet and every time that I use one, I'm getting a loan without collateral. Sure, I could walk away. But overall, the credit card company charges high enough interest to compensate for those who do walk away. It's the same with Bitcoin. The risk is much higher, but the potential rewards are higher too. It's a balancing act.

Well i guess but still there is no point in not looking for a collateral, it just makes the deal 100% safe

No Collateral loan are given to user who are trusted, reputed and trust is a collateral for such loan, giving a no collateral loan to newbie or low profile member is risky, it is always suggested to use collateral so if user didn't pay you can cover your loss,you can give loans without collateral if you can afford money to loose

There is a really small quantity of people that are really trusted and there are others that are trusted because they have done previous loans wich doesnt mean anything, just because they have given or taken loans doesnt mean they are trusted

Actually, I think some lenders are doing it because of competitive pressures. Its not just no collateral loans that are offered either. Now I'm seeing 0% interest too.