The real bitcoin killer app is already here

[daviducsb]

And it is sitting right under everyone's nose...

It is the finite supply and thus the power for bitcoin holders to earn interest.

Bitfinex, Huobi, and Delta Financial are already offering interest bearing bitcoin accounts. They lend the bitcoin out to margin traders. Adoption of this model could revolutionize Wall Street, commodity trading, and many other financial platforms. Apply it to a currency that is a lot less inflationary than the US dollar and most US currencies and you have legitimate interest rates with real returns.

I am not saying all three of the above will survive. One or all could possibly crash and burn. But the idea of doing what is tantamount to peer to peer lending for margin trading is really avant garde and is an incredible feature that only works with bitcoin due to its finite supply.

Combine that with the ability to earn interest on a scarce supply currency and you have a killer app!

What we ought to be doing as a community now is helping to vet the platforms on which BTC holders can earn interest, ask for rigorous audits, and for those platforms that deserve it, spread the word that there is a currency out there with a limited supply that pays a real, dependable rate of interest.

Now a few on this site will probably bust my chops for calling bitcoin a currency and put me down on semantics. Some more will say all three sites offering interest are a scam. For the head in the sand skeptics and tin foil nuts, please don't waste your time, I'm already anticipating your nonsense, as this site is not exactly known for level headed clear thinking.

What would instead be fruitful would be a discussion of how we can refine this killer app. for which there is a real need in a world of central bank manipulation of the money supply and 0% interest rates. Refine, verify, and publicize and watch bitcoin adoption grow.

[Ron~Popeil]

I like the idea but I am quite hesitant to put anything on the line to try it until they have been around a while. I made the mistake once of being the guinea pig and will not do that again.

[daviducsb]

That's totally understandable. That's why bitcoiners ought to work together to pressure those entities to OK third party accounting and other checks. Which will make them stronger and enable more mass adoption...


With the blockchain and a concerted effort, there ought to be a way to do this.

The alternative, I suppose, is to wait for the heavy hitters like coinbase, bit pay, and bitstamp to offer interest. You would think the former two could find a market-effiecient way to pull it off. Maybe inventory advances, peer to peer lending or something else...

The ability to earn interest is a very attractive feature...

[Ron~Popeil]

That's totally understandable. That's why bitcoiners ought to work together to pressure those entities to OK third party accounting and other checks. Which will make them stronger and enable more mass adoption...


With the blockchain and a concerted effort, there ought to be a way to do this.

The alternative, I suppose, is to wait for the heavy hitters like coinbase, bit pay, and bitstamp to offer interest. You would think the former two could find a market-effiecient way to pull it off. Maybe inventory advances, peer to peer lending or something else...

The ability to earn interest is a very attractive feature...

Agreed. If they go ahead with the independent audits I would feel safer for sure. 

[factor280]

More industry regulations are required in order for this to be a reality. Too easy to pack up and leave. We would need an agency protecting the funds.

[Gladdy]

They are all in diffrenct country i don think they will crash .

[daviducsb]

The thing to do would be maybe to create an entity that will vet and perhaps even ensure certain of these platformsn exchange for a fee from the entity . The entity ought to be backed by VC money, which would have an interest in spreading bitcoin use. And all parties would be subject to reserve wallet audit via the blockchain and other methods. Win-win for everyone.

Kind of like what Andreas A. did with bitstamp , but more formal, with a set audit methodology that applies to every participant and so on.

[Keyara]

What is the current rate right now?

[trout]

I don't see what this has to do with finite supply or with  bitcoing in general.
It's just people lending each other some currency for an interest, and some trading platforms
facilitating this. FOr example, bitfinex offers the exact  same service for USD accounts.

[daviducsb]

You missed the point completely but maybe I didn't articulate it well enough. The idea is that bitcoin is more suitable to earning real interest because unlike other currencies, central banks can't just print away and devalue the currency while you earn interest on it. Yes you can earn interest on other currencies, but if you lose the same amount of purchasing power that you earn in interest, the net result is 0 and thus discourages saving. With bitcoin you have a finite supply thus interest earned is more real....

(unless BTC crashes and never catches on which, while possible, is looking less likely these days)

I don't see what this has to do with finite supply or with  bitcoing in general.
It's just people lending each other some currency for an interest, and some trading platforms
facilitating this. FOr example, bitfinex offers the exact  same service for USD accounts.

[novacn]

Good point, although Huobi's trade volumn is fake number.

[lihuajkl]

lending the bitcoin out to margin traders is risky investment. The traders would take as much as risk as his margin account is allowed. Until the last moment, the traders can't afford to pay back. How would the companies offering such service secure the  interest payment without risking the capital?

[forzendiablo]

while i love BTC i have to say.. BTC was first cryptocurrency and didnt understand everything.

would you rather ride 1st care ever made or run any of todays cars? if BTC doesnt adop to changes/ideas it will die sooner or later

[Cicero2.0]

I like the idea a lot. Even a low rate of growth would beat just sitting in my wallet. Indepedent audits mentioned above are a good idea. Trust has to be earned in the bitcoin universe though and after reading these forums for a couple of weeks I don't give it out lightly.

[Elwar]

Great thread...OP talks about marketing the fact that you can earn interest on a currency that is not inflationary and it is followed by half the posts talking about how it cannot be done.

It is being done people.

Welcome to Bitcoin, have a look around.

[Fioraver]

Killer is coming!!!

[zimmah]

wouldn't many people go bankrupt/default on their loans if they take a loan in bitcoins?

how are they going to pay when they borrowed a bitcoin and suddenly the bitcoin is worth 10 times more?

[Elwar]

wouldn't many people go bankrupt/default on their loans if they take a loan in bitcoins?

how are they going to pay when they borrowed a bitcoin and suddenly the bitcoin is worth 10 times more?

Instead of explaining this.

Create a BitFinex account.

Load up some bitcoins.

Loan out some bitcoins.

Get paid.

I made about 1 BTC earlier this year over the course of about 2-3 weeks loaning bitcoins on BitFinex (while the price was falling).

[Sydboy]

Is this really an idea or what people have been doing since day 1.
maybe i dont understand the idea.

[Beliathon]

What is the current rate right now?

500%+ year over year.

I've held for about 9 months. In that time BTC went from ~150 to ~650