Disclaimer: This article is not about Bitconnect or any other scamcoin. Its about an open source project, where you do not have to pay anything at all. I am not affiliated with the bot creator in any way. Always do your own due dilligence, I am not responsible for any actions made by the information given in this article.
If someone told you that you could increase your holdings of almost any specific coin without almost any risks and effort, would you believe him? Well, to me, this sounds quite insane. But, since I’m actually writing this article, there seems to be an opportunity. A smart programmer from Mannheim, Germany developed a nice little tool with a great impact.
What is coin lending?
The tool I am talking about is called a coin lending bot. You are probably wondering what the hell I am talking about, but let me explain it to you. At the moment, there are two major cryptocurrency exchanges which support lending your favorite coins or USD to other traders: Bitfinex and Poloniex. Within this feature, you can set a few parameters like interests, amount and duration to make an offer to other traders, or you can just accept an offer of those. The trader who borrows the money is now trying to trade, in order to earn profit with it. If he does: great. But if not, both exchanges provide an incredible feature. The moment his account balance falls below (= on) the amount he has lent plus the interests, the so called Safeguard activates by itself and forces his account to send you the coins he owes you. So as you can see, this function leads to an absolutely low level of risks.
What does the coin lending bot do?
So far so good, but now we will take look at the exact function of the bot. The main problem with lending cryptocurrencies is their extreme volatility. If you want to lend your coins manually, then you should be aware of the fact, that you would have to log into your account every day (or even more frequently), check the current interest rates and place an order. Seems quite annoying, right? And that is exactly where the bot comes in. He will automate these steps and lend your coins (or USD) 24/7 for the best possible interest rate. And that’s not even the best part. Besides his amazing profitability, this bot is completely free of charge. In addition, you don’t even have to download anything, since the whole process is controlled by the bots website. However, you don’t have to worry about the bot stealing your money. He will only access your account via API Credentials and not with your password or username. Therefore, the bot has no permission to perform trades or withdraw funds.
Are there any negative aspects?
Of course, there are always two sides to every coin (got it? ;D). One downside could be the possibility that Bitfinex or Poloniex somehow run into bankruptcy. In this scenario, it might affect every coin stored in their wallets. This may have previously happened to other exchanges, but as a matter of fact, both exchanges are currently among the biggest crypto exchanges in the world. Another point could be the failure of the Safeguard, which to be honest isn’t very likely aswell, yet it’s still possible. A third problem, depending on where you live, might be the fact that some countries have a different tax policy on the taxation of profit by interests. Last but not least, in case of the bot lending your money for two days or longer, you have no access to it until the determined duration is over or the Safeguard ends it earlier.
How should I use the bot?
Taken all these factors into account, one can see, that this might be a really nice chance for holders who not necessarily need permanent access to their coins. Of course, before you start using the bot, you should do your own research like always. Especially if a possible difference in taxation is affecting you. After that, if you are still willing to lend your money via this bot, you will find anything you need on www.coinlend.org . (English version https://coinlend.org/?locale=en) If you are satisfied with the bot, it would be really nice if you donate a small amount to the creator, since the whole application is completely free of charge and has no advertisement at all.