Digital token trading platform Bitfinex has added Solana (SOL) as collateral on Bitfinex Borrow, a peer-to-peer (P2P) digital token loan portal.
Bitfinex customers will be able to obtain loans of up to 70 per cent of the value of their SOL holdings in US Dollars (USD) and Tether tokens (USDt). At the date of this announcement, the borrowing rate for SOL was 34.31 per cent Annual Percentage Rate (APR).
“We’re pleased to add Solana to our growing list of collateral options on Bitfinex Borrow,” says Paolo Ardoino, CTO at Bitfinex. “This will provide our users with another way to take out a personal loan from our highly liquid peer-to-peer lending markets.”
Borrowers can select SOL from the list of currencies they wish to use as collateral, displayed on the Bitfinex Borrow page, before depositing sufficient collateral into their Margin wallet. A customer can then choose between a variable interest rate based upon the Flash Return Rate (FRR) or a fixed-rate loan. The annual and daily rates, as well as total lending and repayment amounts, are calculated based upon the amount put down as collateral, the loan amount, borrowing period and preferred interest rate option.
Borrowers can choose the length of time over which a loan is repaid, with fixed-rate loans offering a maximum 120 day term. When an outstanding fixed-rate loan expires after 120 days it is automatically converted into a variable-rate loan.
The personal loan will be credited to a borrower’s Margin wallet. Borrowers can make partial or full repayments on both the principal and interest of the loan by moving funds back into their Margin wallet, thereby reducing their daily interest rate. Borrowers will have to manage their own risk of the fluctuating SOL price.
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