Japanese lender launches Bitcoin-backed loans of up to $6.2M

[Oshosondy]

Japanese lender CRYL has launched Bitcoin-backed loans of up to 1 billion yen ($6.2 million), allowing individuals and businesses to raise fiat currency without selling their BTC.

On Thursday, the company announced that borrowers can access between $6,200 and $6.2 million at annual rates of 3.5% to 7%. The loans carry collateral ratios of 40% to 60%. They run for one year and can be used for expenses, including taxes, business funding and property purchases.

You can read it on https://cointelegraph.com/news/japan-cryl-bitcoin-backed-loans-6-million
https://prtimes.jp/main/html/rd/p/000000001.000185286.html

I just copied and pasted the necessary part which I think is good as bitcoin adoption has continued till today. Was it Coinbase we read about last with bitcoin backed loan, more companies around the are also starting offering it.

[PX-Z]

40-60%? Well, that's pretty considerable knowing bitcoin may plummeted for several months or almost a year of bear season. But for someone who wants to loan with that ratio, although 3-7% annual interest sounds pretty small, but still i'd better wait and hold instead, except if you really need cash to run  a business for returns and be able to repay the loan.

[joniboini]

I wonder how good or bad this loan will be. Anyone with similar experience maybe can compare it directly? Still though, the number seems small compared to the number of hacked coins you heard on media every now and then.

Anyway, even if such loans are available in my are, I'm definitely not the market for that. I'm more comfortable getting enough funds on my own before doing anything risky.

[Churchillvv]

Small numbers big impact in when you take the loans, they upside seem beneficial to the borrower but in longer term it’s far more beneficial to the company, it’s a good one in terms of adopting this measure but however I prefer to take a on physical property than loan on my bitcoin. However I wonder how exactly they run this, you give them the bitcoin or access to the bitcoin investment until you're able to pay the loan. 

[JiiBs]

40-60%? Well, that's pretty considerable knowing bitcoin may plummeted for several months or almost a year of bear season. But for someone who wants to loan with that ratio, although 3-7% annual interest sounds pretty small, but still i'd better wait and hold instead, except if you really need cash to run  a business for returns and be able to repay the loan.

Obviously those that would want to take these form of loans are those that don’t want to sell their Bitcoin and would want to use fiat for something important, looking at the amount the loan amount being between $6k to $6m. That’s no small money but then, is the interest being paid with Bitcoin?
Or would this be coming of fiat as well.

What this goes to prove though is how valuable Bitcoin has come to be to serve in this capacity in our society, that would reinstate in the people that Bitcoin is indeed an asset of value.

[PX-Z]

... but then, is the interest being paid with Bitcoin?
Or would this be coming of fiat as well.

The loan repayment is in fiat including the interest, it doesn't make sense if they offer loan as cash/fiat for disbursement and then the payment is in form of bitcoin including interest. Its possible for lenders here but not on lending business irl. Bitcoin/crypto is only for collateral.

[X-ray]

40% to 60% collateral ratio means they want to play it safe and the annual rate is honestly pretty high compared to existing defi where we can borrow the stablecoins from with Bitcoin collateral.

But it's a good one step forward for Japanese lender to set precedent that they could accept Bitcoin which is great.

Biggest benefit would be the non taxable event.

[Sermuezzin26]

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[Rashlyowl]

I wonder how good or bad this loan will be. Anyone with similar experience maybe can compare it directly? Still though, the number seems small compared to the number of hacked coins you heard on media every now and then.

In my opinion, that would be a good loan backed by BTC, it offers an annual rate of 3.5% - 7%, which isn't vastly different from conventional loans in Indonesia, though those typically carry higher annual rates. With conventional loans, the bank only assesses our assets in the event that we ultimately fail to repay the loan. However, for this BTC loans, we are required to provide collateral ranging from 40% to 60% of the total loan amount.

The minimum loan is $6,200, this requires maximum collateral of 60% ($3,720 in BTC). If we fail to repay the loan within a year, that $3,720 in BTC will become $3,459 (in the event that the price remains unchanged), not a bad loan.