Indian Crypto Exchange Launches Crypto Lending Services

By Prashant Jha

Coindcx, an Indian crypto exchange has announced a cryptocurrency lending service for 5 digital assets. It’s more like a hedging scheme where the users who decide to hold their crypto assets on the exchange can earn interest on their holdings. The services have been made available for BTC, USDT, BNB, XRP, and ETH.

The crypto assets holding would earn the users an interest rate of 2.0% for Bitcoin, 1% for USDT, 1% for BNB, 0.75% for Ripple and 0.75% for Ethereum. The interest rates are on a monthly basis and the crypto lending services are open.

The CEO of Coindcx, Sumit Gupta explained that the Bitcoin holds the highest interest rates on his platform because most of the services on the exchange are paired against Bitcoin and most of the margin trading is done with BTC, creating a high demand for the coin.

How Does Lending Services Function on the Exchange

The exchange website has created three windows for its new crypto lending service. The lending terms include a 7-day period, a 15-day period and a 30-day period. The interest rates for different time periods vary dynamically and the highest rate comes at 2% per month.

The exchange also makes it quite clear that the cryptocurrencies lent by the users would be leveraged for other users of the exchange, through other forms of services offered by the exchange.

During his interaction with the media, Gupta also mentioned that they ran the beta testing programme under which only BTC and USDT were up for the lending programme. during the trial run of the lending service, there were a total of 120 lenders who participated in the test and the exchange achieved a circulation of 170 BTC on a daily basis during the trial run.

Gupta also suggested that the program has been received well by the community and looking at the demand, they might scale the program further and add more coins as well.

The CEO also mentioned that the exchange works on an internal settlement and liquidation mechanism for margin trading, which does not call for the need for a dedicated wallet. He elaborated,

“Funds are then lent to the users only when the margin trade is open, with no withdrawal access and hard liquidation with 7.5% maintenance margin.”

Final Thoughts

The use of cryptocurrency in India is not legal yet, but the government committee responsible for finalizing the drafts of the regulatory framework has recently reassured a number of times that the regulations are on the verge of finalizing and might get into effect real soon.

This is the reason the activities and services related to cryptocurrencies are on the rise. The Coindcx exchange’s decision to include crypto lending services are a clear indication that India is looking to expand its crypto portfolio. Crypto lending services are gaining worldwide popularity, and it was only a matter of time before many other crypto exchanges might come up once the regulations are put in place.

Prashant Jha

As a content writer Prashant believes in presenting complex topics in simple laymen terms. He is a tech enthusiast and an avid reader.

Related Posts