BTC Lending Market (Poloniex) Discussion

[legendbtc]

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?

[rotors]

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

[Kevin77]

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.

[xleejohnx]

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?

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

 

[legendbtc]

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.

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.

[alyssa85]

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

anyone have any thoughts.

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.

[cryptogear]

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?

[spatifilium]

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.

[p3ppymon]

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.

[btcdiggingmaster]

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?

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.

[oup59]

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?

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.

[barnes13]

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?

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.

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.

[cryptogear]

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?

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.

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.

[enquirer]

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.

[enquirer]

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.

[Kanine Awe]

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.

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

[enquirer]

Update: coins returned. Lucky this time.

[btcdiggingmaster]

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.

[vapourminer]

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?

[alyssa85]

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.