Binance Loan: Is it a good option?
Binance Lending is a cool feature that allows users to borrow or lend cryptocurrencies. But is it really worth it? Let’s break down how it works and the pros/cons of this option.
How does Binance Loan work to borrow?
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To borrow on Binance, you must provide collateral equivalent to the amount borrowed. For example:
If you want to borrow 100 USDT, you must have 100 USDT in your Binance account. This amount will be locked as collateral until you repay the loan.
In addition to repaying the borrowed 100 USDT, you will have to pay a commission fee of around 20%. This means that in order to get your blocked funds back, you will have to repay 120 USDT.
In other words, Binance lends you money by “confiscating” your own money as collateral, and charges you a high fee for this loan. This system may suit those who need quick cash, but it is expensive and may not be attractive for small amounts or non-urgent needs.