Bitcoin Forum

So just stumbled across this recently.  What kind of prices, volume & terms have you guys who lend & borrow BTC for trading been getting?

up to 2%

ETH hype makes it possible lol

http://s28.postimg.org/5xury3qb1/loan.png (http://postimage.org/)

 ;D

Let Uncle Pegasus dispense some priceless wisdom.  :
  
People are going to get so excited that they can buy on margin, so when they see a coin (ahem, ETH) go up and up they will naturally think, "Gee.... why am I limiting my profits!?  Let me borrow some more ETH based on the ETH I already own!"  They won't even look at the lending rates because who has time to worry about that?  
  
Then the price of ETH will go up.  
  
Others will see this and come to same conclusions, and also borrow ETH based on the ETH they already own.  
  
Then the price of ETH will go up.  
  
Suddenly, the price will stall slightly.  Now, the first borrower has a comfortable liquidation margin (to the point where it's not even an issue).  He thinks.... hmmm.... it looks like the market may retract soon and I will lose even more than usual based on the retraction.  Well, let me just fire a few more margin bullets at this problem and "help the cause".  
  
Then the price of ETH will go up.  
  
Others will follow suit, all doing their part to keep the price of ETH on the uptrend because they are all margined to the hilt in this thing together now.  All of them are pumping ETH hard because they all know they have a lot to lose now.  Also, those prices to liquidation are suddenly a lot closer than they once were.  The air of enthusiasm suddenly takes on a slightly desperate edge.
  
Then the price of ETH goes up.  
  
But nothing can go up forever.  Eventually someone will take profit.  Eventually one man in the madness will say, "Ok, enough.  Let me get the fuck out of here before this shit goes iceberg."  
  
Then the price of ETH goes down.    
  
The most margined-to-the-hilt fool is hit first.  His entire account is liquidated and sold off to meet the demands of those he owes.  This floods the ETH market with a little extra ETH than usual.  Supply will outstrip demand, especially at these inflated prices.  
  
Then the price of ETH will go down.  
  
This sets off a nuclear fission reaction that will cause ETH to FUCKING DROP LIKE A ROCK.  
  
And this children, is a story as old as time: the margin crash.  And we are going all get to see it again soon, and the traders, lenders, and even Poloniex will all learn a valuable lesson.

Do I understand correctly that if you take a loan on polo and your account value is about to drop below what you owe someone, all your assets are automatically sold to meet the debt you owe?

polo still refuses to publish the needed numbers. with the current  ETH volume this is just insane and gives them way too much power, market participants should not accept this. also power is given to those who have enough to lend out so they can estimate the total numbers and still have enough coins to manipulate the markets.

yes, but the possibility exists that this does not work(becasue there are no buyers) and the lender also does not get everything back if the exchange does not jump in and cover the losses

Yep. In the regular asset markets, exactly the same procedure applies. It's usually buffered by a "margin call," which gives you a short window to deposit more funds to increase your capital buffer, but legally a "margin call" is a courtesy. Once the asset's value drops below the "minimum maintenance margin" amount, the firm you're dealing with has iron-clad legal right to sell your position whenever they want. They don't want to eat the loss themselves!

Than it can indeed really cause a massive crash to occur if too many people have these calls open.. Quite dangerous in these circumstances.. :o Would be interesting to see what happens though ;)

This happend already on btc-e or bitfinex. its no problem as long the exchange is solvent. On higher leverage exchanges like okcoin or 796 they are socialising losses

Hey sooooo, a bunch of people were really irresponsible with their money so now we have to take some of *your* money. 
 
hmmm... where have I heard this before?  ::)

I guess I'm more curious what the market was like pre eth ....

i see there is 0 loan demand in Poloniex now?  ???

The loan demand column is usually empty. Most traders are willing to pay a higher loan rate then the lowest loan offer, so the order get executed immediately.

It's mid December now and it is still 0 loan demand now. But the Loan Offer column is moving with each refresh. Is there some kind of bots that is snapping up the loans?

Do you need a certain level of account to be able to loan btc here? I can't seem to find it. I do find the tab of loan, but I don't see anything in that tab to make it able to loan ... Any help? :p

These loans are only used for margin trading.

With margin trading you can (for example) lend a coin and sell it, and later buy it back cheaper (and settle the loan).

no you don't have to have a certain level. just make sure you transfer to your lending wallet in order to start loaning out

i have mixed feelings about this!;

was just checking on the exchange, the highest demand was 1.78 btc at 0.1% interest for 2 days,
1.5% a month if you manage to pull it off back to back for a whole month.

based on what's in this thread (https://bitcointalk.org/index.php?topic=1386692.0), the risks are virtually nonexistent unless sth happens to poloniex itself.
it's certainly better than just having your btc sit;
but at the same time you have to be hopeful nothing happens to ur precious coins on poloniex!

its free money and a compromise at the same time!!!

and what is with their strange account verification?!
filling in a few boxes which has no meaning since they aren't actually checking them against anything!
what guarantee is there that people are providing actual information?!
i'm confused!

The loan rte is very low these days and you could earn much more in alt trading, if you just watch the market and place orders.

Anyone tried to use scripts to automate lending and automatically adjust the interest rates? There is one on github but it is not working very well, or poloniex blocked it.

No, I'm doing it manually with the Factom I have.

It's actually a fun way to enter into the world of margin trading without taking the risks that margin traders undertake. In my case, I manually set the daily interest rate at 0.03% to 0.04% in most cases. I'm already noticing that most of my loans get picked up when the Factom market becomes volatile, even when my offers are well above the low offer. On the other hand, when Factom's stable, loan offers set at 0.005% go begging.

FWIW, here's a quick table of daily interest rates compounded to annual:

0.005% daily......1.84% annually
0.01% daily.......3.71% annually
0.015% daily......5.56% annually
0.02% daily........7.57% annually
0.025% daily......9.55% annually
0.03% daily.......11.56% annually
0.035% daily.....13.62% annually
0.04% daily.......15.71% annually
0.045% daily.....17.84% annually
0.05% daily.......20.02% annually
[and so on...]

Of course, the above yearly rates assume that the alts are continuously borrowed - which is not the case. And that's where the challenge comes in: finding a rate that's high enough to produce a decent return but isn't high enough to leave your alts idle.

The neat part about the Lending market is that you have to pay attention to the market for the alt itself almost as if you were a margin trader or short seller - but you're taking a lot less risk than the foregoing punters. It's a real learning experience.

How can a user who lend 10 BTC be 100% sure he'll get back his loan+interest? Does poloniex vouch for a loan or how does this work?

You can't be 100% sure, because there's a teeny chance that a black-swan will wipe out the borrower's margin cushion (and more) before Poloniex liquidates the trade on the grounds of insufficient margin. The lending is OTC, so Poloniex doesn't vouch for a loan. All Poloniex does is liquidate a borrower's trade-gone-wrong automatically if the borrower's equity falls below the margin-maintenance threshold.

So thee is counterparty risk, but it's slight. In the case of a margin-buy, you'd have to have a huge crash in the borrower-bought alt before your BTC would be at risk of default.

Do you guys think Poloniex is safe to deposit more coins to generate interest in the lending section?

I do. In fact, I have.

I just want to confirm my calculations are right.

On average, we earn 0.03% interest each day through lending. So, annually, we are talking about (0.03 x 365) 10% interest gain?

Almost, you're making a little less than 10%, because Poloniex takes a 15% fee.

You can see the fee here: https://poloniex.com/tradeHistory  and then "show" "Loan Earnings"

How is poloniex better than nova exchange? Which one is more reliable in terms of giving stable prices in the long run?

Hi weryo, thanks for point out that link! Saw it. Useful! Thank u!

I don't know; I've only tried Poloniex.

I'm having better luck on Nova - I'm getting much better rates there.  There are too many lowballers lending for cheap on Poloniex. Why the hell would you risk you crypto on an exchange for 0.03% per day before fees - you're better off putting money in a CD.

Novaexchanges supports lending? What are the average daily interest rates?

"
Novaexchange is closed for maintenance
During maintenance the exchange will go through a full code review to find weaknesses, go through penetration testing and functionality testing
A fundraiser has been started by Bejjan @ scryptpool.com to finance the BTC and LTC missing to Novaexchange userbase. click here for more info
Read the original notice that the security of Novaexchange was comprimized
Stay tuned for updates
"

sounds not rly trustworthy :-\

What's going to happen to users' coins @ Novabase?

in poloniex lending not support fiat money or USDT
because USDT not support margin trading
only support altcoin and bitcoin in lending system

if you want margin trading in poloniex is good
because in there loan interest is very low
but if you want lending is not competitif interest , return is low

I heard polo was hacked back in the day... Kinda risky to keep your coins sitting there long periods of time making only small revenue.

Poloniex was hacked in 2014, but they compensated everyone, so people using the exchange didn't lose money.

If you really want to earn by using lending, why not try Margin trading? You lend to your broker, and earn by Margin Selling or Margin Buy.

why are laon rates so much higher on polo that bitfinex?

anyone have any thoughts.

Even I don't know how Poloniex lending works, I see there are many people showing interest towards lending.
Can some on explain to me how this lending works in Poloniex, is it safe to lend money in Poloniex exchange?

Yes Polo should guarantee that you gain back money even if person goes defunct. Have been easy so far.

That is because most of the time money just changes hands on their platform, whoever gambles altcoin trading with the Lenders money and loses you can directly assume that there is someone else who won, which is why you can subtract the amount from their comissions, both for loser and winner and the fee basically pays for the lender instead of borrower.

you have a margin trading tab and on that tab someone puts money into to show credit
and then they can take a loan off the lending pages for over what his value is on the margin tab
this person is taking on  a loan for highs and lows on whatever coin this person is trying to flip for a profit
even if the person defaults on this loan the money tied up in the margin loan this person cannot get back once its in its in
the only way lending money on poloniex would hurt you is two ways
when the fork happens and bitcoin U takes over and when it does the BTC you have in lending wont get duped into BTU because you dont "own" the btc anymore the margin trader does
if the site gets "hacked" and they lose their btc holdings


this isnt step by step on how it works but a short bad summary of how it goes down with lending and loses

 

It indicates that there is risk involved in lending also. What I thought is Poloniex will take care of our money, who doesn't pay us on time.
So it is also time waste for us instead of lending why don't we ourselves go for trading then.

Supply and demand. The loans on Poloniex are from members, not Poloniex itself. And members do not always want to lend - when a coin goes high, sometimes they prefer to just sell it, which is why the loan rates go up.

Also, the BTC loan rates depend on whether there is a pump going on. When Dash (or ltc or ether or whatever) is being pumped, you need to borrow btc to go long via margin trading. There are many more pumps on poloniex than on bitfinex.

Is this stuff working on Polo? I mean you can safely invest you money in lending? What happens if somebody defaults a loan? Is there a required collateral ammount in other cryptos?

sometimes I have no time for trading, so this idea with the lending seems ok to me, the only question is how high is the risk of losing investment by giving the loan, because it is not clear to me that if a person lend resources and those lost to the transaction and not have so much to return, how do I get back my investment with interest, because the one who borrows and loses investment can open a new account and start all over again.

Borrowers have funds as collateral and they are kicked out if their position goes down by their pre-established amount. This hugely minimises lender's risk.

That is what everyone is discussing about, many people still not aware of how lending works in Polo. What I understand is after lending there is no guarantee whether he will pay or not. I think when compared trading, lending has higher risk involved in it.

I read it somewhere else. May shed some light upon subject:


-->Once you put coins up for lending, the transactions are handled internally and automatically. The lender offers coins at his specified interest rate and the loans are generated automatically when someone places an order in margin trading. Lenders on Polo commit their coins for a minimum of two days. If someone holds a margin position for longer than the loan term, the lender gets his coins returned (with interest), and the system uses someone else's funds to keep the margin position open. If a margined positions falls below the 20% maintenance level (the bet has gone sour, and the margin trader's position has lost a lot of value), the trade gets force-liquidated and the loaned funds get returned (with interest).The loans are done internally and seamlessly. Don't sweat it -- loan funds are safe and borrowers can't run off with your money.<--

So two risks:
a. Exchange is hacked.
b. Too many short-sighted margin traders all coincide at the same time you lend and/or market crashes  and exchange can not cover all the loss from the fees/commisions immediately.

It sounds like as long as the exchange on which lending happens is a trusted platform and willing to cover losses then the risk is zero-ish.

Does polo give such assurance under any contract?
As far as I know--> No.

But likelihood of happening item a or item b is not high as well.

Sorry if I wrong, lend in poloniex is different lend your money to someone in real life, when you lend your money in Poloniex you don not worry about people will pay or not, you will get pay and profit but the concern in Poloniex lend is profit you got is small, you need huge amount if want to get big profit from Poloniex lending service.

plus there is a minimum collateral needed in altcoins afaik.

Just happened to me for the first time - my loan is 4 hours past due. Has trader defaulted and Polo's algorithms failed to recover the loan? Or some temporary glitch due to servers overload? We'll see.

Probably related to the reports people's balances disappear due to Stop Limit Bug. If her balance disappears, obviously she can't repay the loan. Hopefully this all will be sorted out.

Hopefully all works out for you.  If longer than 24 hours I would begin to be worried and maybe shoot them an email.  Best of luck to you :)

Update: coins returned. Lucky this time.

That's very good news to hear because it will help to people who are very sad about POLO. Right now there are many problems with polo we have to give them time to change that everything will become normal once they grow through with all coding.

ive been lending at polo for a few months, no problems. i set most to not renew so go in every couple days to see the rate and modify them based on the market.

i typically only have under 0.5 btc out and break it into several 0.1 and 0.2 loans for 2 days.

what do most of you do?

I set most to auto-renew, but keep a daily eye on things - if the rates are higher than my auto-renew rates, i turn the auto-renew off, and manually set a new rate when the existing loan expires.

I try to lock in high rates for a long time. So if I can lend at a decent rate, I'll set the loan for about 10 days. If I'm lucky, it'll run for at least 3-4 days - it's a nice way of cashing in on the high rates.

Whats up with the ridiculous loan offers on ETH,  0.0001%  ??? was around 0.0030% a week ago.

The rates for alts like ETH will only go up if there is shorting activity (where the trader has to borrow ETH to sell on margin).

I don't know how this Polo lending works because is there any guarantee that the lender will pay the interest on time. I am very eager to know that whether they will take all the details of us for lending money in Polo.

All is automatically. When you lend for 2 days at 13:50 the funds are returned (with interest) no later then 13:50 two days later. Only a few days ago there was a problem with margin trading, so it took a few hours (up to 24 hours I guess) extra before payment returned, but that was the exception.

Poloniex use forced liquidation, when the funds of the trader are too low, so the chance you will receive not all of your money back is small (but exists!). Another problem could be when Poloniex went bankrupt or is going to be hacked.

For more information: https://poloniex.com/support/aboutMarginTrading/

I use Poloniex Lending bot ( http://poloniexlendingbot.com/ )
Then your money is going to be lend for a decent recent rate. You can enter a minimum rate, and more details. It works very well for me, because sometimes the lended money is returned shortly after lending, and I'm not watching Poloniex 24/7

I can't find the thread now, but I read a post a while ago of somebody who had the same amount lending in two different accounts. One was done by hand, the other with the lending bot. Even with the 10% fee the bot made more profit.

currently earning so little that it is not worth putting assets on loan

????

My outstanding loans are between 0.1379 and 0.2999 %

So the lowest has an interest of over 50 % per year (!) and the highest even over 109 % per year.

I don't think that's little.

Agree. Perhaps people are getting confused and don't realise that the interest rates quoted are per day?

My point is that percentages are very low, they are now 0.0001%
And all my funds are at  MY OPEN LOAN OFFERS and i have a percentage of 0.1000 %
If you have such a rating it's great, but my loans though are active not in use

I guess you're loaning altcoins. There are some with better rates, but most are very low. But bitcoin is going very well.

Current rates: (ofcourse very volatile)
 ETH 0.0004%
 BTC 0.1588%
 BTS 0.0901%
 CLAM 0.0050%
 DOGE 0.0020%
 DASH 0.0037%
 LTC 0.0070%
 MAID 0.0001%
 STR 0.0010%
 XMR 0.0001%
 XRP 0.0003%
 FCT 0.0097%

i always get 0.2% interest per day but on crazy days it can go as high ad 5% per day but it doesnt last long

with all the poloniex drama of late i pulled my coins out. might have to toss one back for lending and see how it goes.

never had problems with polo in the past couple years but as they say "past performance does not guarantee future performance.."

Hi. Could anyone explain to me if there is any easy way to see the current interest rate one is paying on a margin loan on Poloniex? I know I can go to lending and see what's on offer. Some of the rates I am seeing like .001 which I think comes out to 3% apr seem really low to me. How can I tell if that is the rate I'm currently paying without going to the lending page?

thanks in advance!

This website shows historical data
https://cryptolend.net/rates.html (https://cryptolend.net/rates.html)

Yet to understand the difference between the column loan offer and loan demand. Would someone be kind enough to explain. Thanks in advance

When you lend, you place a loan offer.

When a former loan is completed and the borrower will renew this for a rate lower then available, it's a loan demand. Only, the loan demands with good rates are never available, mostly due to insufficient amounts (<0.01 BTC for example). The total can be more, but it contains only small parts AFAIK, which can't be lend.

So only look at loan offers, and forget the demands.

now understood, cheers

This is the formula to calculate the daily interest earnings (assuming you lent 1 BTC)

( (current loan rate)% * 1 ) * 0.85

for example, the current loan rate is 0.06%

(1 BTC x 0.06%) x 0.85 = 0.00051 BTC

Just as BTC is a valuable and valuable currency, lending can happen. Just like a bank gives us a loan and pay interest every month. If the bitcoin loan happens, we will get information as to if there is fraud. Because transactions on bitcoin are confidential transactions we do not need to know each other.

Hello all,

Is rate a daily or 2 days as marked?

https://2.bp.blogspot.com/-mKqJ6-CDEXg/WXyIuw_tCrI/AAAAAAAAg_A/n6nPjvVL5dsOt_wJwxcE3_coQOAm50pgwCLcBGAs/s1600/Captureasadsadasdas.PNG

Thats the daily rate is shown there. When you lend your BTC, you can lend it for 2-60 days and the borrower pays that interest rate until he returns your BTC

How are other people experiencing offering loans on Poloniex?
I've been starting to notice that the offered loans are not getting on my balance when the loan is due. Right now I will track if the loan earnings are correct, since a week I am starting to get suspicious as my earnings are no where close to what it should be (Even after several calculations).

Im lending in poloniex 30 BTC last 30 Jul . Rate is 3%

https://image.ibb.co/cmm9pv/poloniex2.jpg

Is normal it still open ? , is very stranger ? Any in this forum have same situation ?

Nothing wrong with that. You should consider yourself lucky and hope it lasts 60 days until the loaner releases it. :)

You should also hope polo wont go bankrupt in the next 60 days. I had this fear and moved all my funds out of polo.

3% is quite a good rate. The lending rates have collapsed since people started to move away from the exchange (and hence do less margin trading).

may look into this and move some coin back to polo for lending.

pulled everything out a while ago once the complaints started rolling in.

I have been lending in poloniex since the fork began. The highest mark that I had seen was 2% because of the btc scarce. Right now my btc returns are around 0.01% - 0.02% and there is nothing wrong with it, at least my btc is gaining some satoshi instead of static value.

The highest loan ratings, I got on poloniex, were 4 percent with doge on its hype.
I will wait a bit and go to lending.

So, if I had BTC in an active Polo loan (I was lending) during the fork, am I suppose to collect BCH for my BTC's or not?

No, that was clearly stated. When you loan BTC you possess only the worth of it at that time.
When there was a part not on loan at that specific moment of the fork, you should have received BCH for that part.