Could STEEM Backed Loans Help Reduce Sell Pressure?
Hey Jessvestors
If you've been following my blog for some time now you'll know when it comes to crypto, I'll try just about anything since I find this space so fascinating. I recently got into earning interest on my crypto deposit with crypto.com.
So far i've made $0.25, lol My interest in earning interest took me down the rabbit hole that is crypto-backed loans and I think it offers a unique opportunity for us as steemians.
One of the key issues with STEEM is the value, people are dumping this coin by the millions and tanking the price because, well they want money! They want the fiat, they want to use their earnings and they want to use it now.
The more dumped for fiat the more selling pressure and the more the coin tanks. The HF and other changes have encouraged users to hold more STEEM but it doesn't quite address the issue of users wanting fiat for their STEEM.
Image source: - oliverisaacs.com
Could we be primed for a loan market?
A cryptocurrency backed loan allows a user to submit their cryptocurrency to a third party as collateral and acquire fiat in the process.
The third-party charges a fee for the service and can do with the funds as they please, this could be to curate, delegate or trade and earn a profit on it. The company can also use the funds to invest in hedge funds, institutional traders, and exchanges to generate interest.
This could also work extremely well with the fact that we have SBD, the funds at the time of deposit can be converted into SBD and then fiat paid out on that value.
The user then gets their fiat to do with as they please. The user getting the loan then has to pay back the loan along with interest. Which will bring more money into the ecosystem and once the loan is paid back, they can get back the cryptocurrency they had put down as collateral.
Reducing sell pressure
It provides a great option for those who want to HODL but require a quick injection of capital. It also reduces the need to dump Steem on the market and keeps capital inside the ecosystem or in 3rd party accounts but most importantly off sell books.
Adding new revenue streams for STEEM
There are already around 10 crypto loan projects running at the moment trying to prove that it is a viable use case and to me, I think it is.
We could look to piggyback off of their infrastructure at first and get STEEM and SBD listed as one of the supported currencies and if we see steemians using the service by checking the amount of steem being sent to their accounts and back we can look at creating a native version on steem.
Yes it will bring with it challenges like KYC and defaulters and managing of a mixed bag of currencies both cryptocurrency and fiat but I still think its something we should explore as a community if we want to find new ways of bringing liquidity into the chain and building its value over time with new streams of steady income.
Let's connect
If you liked this post sprinkle it with an upvote or resteem and if you don't already, consider following me @chekohler
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Just use dlease.io to get about 17% return on your STEEM power.
Thanks for the tip, I've delegated 1000 SP for a 2 week and 4-week lease, let's see how this works. Will dlease automatically cancel the delegation or do you have to revoke it or get a notification to revoke it?
They will send you a memo at the end of the lease and then you will need to cancel it yourself. It can be done on their site with one click.
Sweet thanks. gives me a new reason to keep powering up now. I love finding new ways to earn passively. This could really become much bigger with RC delegations in future :) pretty awesome
I thought steem already had something like this someone had started. I think it's a good idea.
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I wouldn't be surprised if there is, there are so many projects on steem that its easy to become hidden. We really need a directory for all steem apps, I will check out thestateofdapps to see if I can find one
If I new the name I would let you know. Steem definitely needs a directory so people t find what the are looking for if it exists.
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I believe @neoxian is the guy you're thinking of.
Yes I think that's it.
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Now you have my attention :) Where do I find out more?
https://steemit.com/bank/@neoxian/updated-loan-requirements
came here to say this....
Let it out man, we're here for you!
It would be fantastic to keep Steem in the community. I’d love for there to be a safe and effective way for people to sell their Steem to people who actually use and invest in the platforms! (Keep everything within Steem’s ecosystem, no exchanges)
I'm all for STEEM eventually building its own ecosystem and keeping the currency flowing in and being used positively. At the moment all we have is earn and dump
Hmm. Sounds promising. Now I’m expecting a Steem Bank and Trust to pop up too.
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Wouldn't be surprised if we eventually get to a point where we have these facilities!
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