On certain exchanges you can offer your BTC for loan to margin traders who use it to leverage a long position or take a short position. I use Poloniex. I will never lend through a broker to an individual or business as they can default, where on an exchange the borrower would get stopped out so that you get paid.
The lending rate has actually already sunk as BTC is returning to polo. in 24hours it went from 3% to 0.03% lol ... its still a low risk alternative to put your 'capital' to work.
Thanks. I was hoping you were not going to say Polo as I have had major issues with them and will not use them again. There is something very dodgy about them and I wont risk using them again.
If there is an alternative, I am interested in looking into it though. Ill keep looking. Thanks
do you mind sharing what you find dodgy -- market share speaks for itself. UI is ugly but functionality is there 100 %
They suspend coins for weeks at a time with no notice. They put withdrawals into 'pending approval' state with no explanation for weeks at a time. Customer service never answers tickets. and the list goes on. These things do not lend confidence to the use of the platform. It is not just me that has experienced this, it is many other users. If a real world business operated like this, it would be bankrupt very quickly. I have no idea why anyone would opt to use them (apart from the ability to lend out coins we discussed earlier).
I no longer have any confidence in Polo and have withdrawn all funds and will not use them again.
In all honesty you shouldn't trust any of the exchanges. I stay as liquid and spread out as possible. My view, however, poloniex doesn't want to list what i refer to as shit coins because they impost a great risk to the exchange.
Since the market is new, I doubt there is any insurance. I think poloniex decision to lock certain coins is a form of consumer protection. Market share at poloniex speaks volumes. The most important thing is to stay liquid.
I will never use polo again. As crypto goes more main stream they will be forced to clean up their act or go out of business. At present I have no faith in them as a business. They basically freeze funds with no explanation and refuse to resolve support tickets for weeks at a time! With the losses on crypto exchanges over the last few years I do not trust them. There are several alternatives which offer a much better service so I will give them my business!