smart use of Bitcoin to quickly lend money
Germany is generally regarded as very conservative, but when it comes to the adoption of Bitcoin they should only let the US go. Bitbond is a German bank that makes smart use of the crypto coin to be able to close and realize relatively small loans internationally and in the blink of an eye. Normally you have to transfer international money via Swift and besides the long lead time of a few days, there are quite a few costs involved. But if you need money as a business now Bitbond can arrange that.
They do this by transferring an amount in Bitcoin to a company, which then transfers it to their local currency within a few seconds and in any case the same minute, making the fluctuation of Bitcoin (always a risk) as good as can neglect. That immediately bypasses one of the biggest problems that Bitcoin has as a means of payment namely the volatility and the costs of the conversion. Because it only needs one side and is still cheaper than the alternative, it works in this context.
The service has existed since 2013 but according to founder Radoslav Albrecht is becoming increasingly popular among customers. The company has now grown to 25 employees who manage approximately one million loans per month for around 100 clients. Small beer in the banking world, that’s true, but that’s not bad, says Albrecht. Most customers are small and medium-sized businesses or freelancers and the loans do not exceed 50,000 dollars, but it is precisely that target group who values the speed at which they can get their money. Of course, it also helps that it is simply cheaper to get rid of international money in this way if the local banks do not co-operate.
Where does Bitbond get all that Bitcoin? In addition to their own stash, they also get it from other people. So as a Bitcoin owner, you can also turn off your digital money (anonymously) via the bank and get a very nice interest on your Bitcoin, without having to spend it. You will not be fully guaranteed by the bank that you will get your money back, so it is a risk that you have to be prepared to walk. In this respect, the bank is more of an intermediary, with a market place where people with Bitcoin and people who need money can find each other, and the possibility of basically assessing borrowers on payment behavior and credit score. Whether you have to put your Bitcoin in is a bit questionable, but the idea that the bank has for the transfer of the money is good at any rate.