How does rising BTC prices affect the loan market?

[justspare]

I don't really see how the price of Bitcoin effects bitcoin loans. I'm pretty sure that most people will charge the same amount of interest, regardless of the price.

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[justspare]

I do some P2P lending and with the recent uptick in Bitcoin price something crossed my mind, how does this affect the rate of payback? Logically, anyone who uses the coin to convert to cash is going to have a harder time to pay it back. Of course, the opposite can be said for times where the price goes down.

My fear is that the price is going to go up now and this puts my loans at risk for default. Anyone have experience with this?

I think this depends greatly on the reputation of the borrower. It helps to communicate with the person you're lending money to and offer to make a deal if the price rises tremendously.
It would be even better to mention this before making the loan, rules for what happens if the price rises.

Exactly. It also depends if the borrower is trustworthy or not. You just have to choose who you give loans to wisely. If you do this, there is a lower amount of risk.

[foxbitcoin]

It is not always bad for both parties. If borrowers spend the bitcoin directly, he has bitcoin incomes, like mining, job payment etc, he wouldn't lose anything from the increasing price of bitcoin. I know many bitcoin lenders have large chunk of bitcoin in hands. He lends out bitcoin and receives bitcoin interests. No matter bitcoin is up or down. He will still be happy to see the amount of bitcoin is increasing. The exception is that he is trading bitcoin and lose the opportunity of selling out bitcoin before the price goes down.

[michinzx]

I do some P2P lending and with the recent uptick in Bitcoin price something crossed my mind, how does this affect the rate of payback? Logically, anyone who uses the coin to convert to cash is going to have a harder time to pay it back. Of course, the opposite can be said for times where the price goes down.

My fear is that the price is going to go up now and this puts my loans at risk for default. Anyone have experience with this?

I think this depends greatly on the reputation of the borrower. It helps to communicate with the person you're lending money to and offer to make a deal if the price rises tremendously.
It would be even better to mention this before making the loan, rules for what happens if the price rises.

Exactly. It also depends if the borrower is trustworthy or not. You just have to choose who you give loans to wisely. If you do this, there is a lower amount of risk.

not really, most of the time the borrower on these p2p platforms arent repeat customers and dont have any reputation to go off of. lenders are only attracted by the high interest rates these [2[ lending sites charge. with little repercussions for defaulting, a lot of the borrowers end up defaulting.

[nonbody]

IMO it is effecting the loan market a lot. Many borrowers are selling BTT accounts through requesting a loan.

[EdenHazard]

I do some P2P lending and with the recent uptick in Bitcoin price something crossed my mind, how does this affect the rate of payback? Logically, anyone who uses the coin to convert to cash is going to have a harder time to pay it back. Of course, the opposite can be said for times where the price goes down.

My fear is that the price is going to go up now and this puts my loans at risk for default. Anyone have experience with this?

you dont have to fear about that,your loan is tottaly safe,price movement should have been predicted by any market,and they can adapt with that situation,i never feel that before,just because i dont take any risk to get a loan.