With each passing day, alt-currencies are increasingly making their presence felt more and more in our daily lives. Companies like Binance, Coinbase are making crypto trade highly streamlined and efficient even for the average enthusiast, thereby spiking the overall interest towards the crypto sector.
Binance is breaking new ground
Many cryptocurrency exchanges are gradually being viewed by the masses as being legitimate substitutes for traditional banking institutions.
In this regard, Binance seems to be taking a novel approach and offering customers with loans that are backed by digital assets. In order to make this a reality, the world’s leading crypto exchange has partnered with Libra, a software and data platform that helps support operations within todays global crypto asset ecosystem.
It is also worth mentioning that Uphold, another cryptocurrency and investment platform, is gearing up to release a similar crypto backed loan offering. However, since Binance is widely considered to be the top dog in this space, the company is receiving much more attention that UpHold.
How will all of this affect the current economic market?
If everything goes as planned, this latest initiative taken by Binance and Libra Credit can push the boundaries of traditional finance and allow for a whole new section of society to access credit and other essential economic services.
According to the reps over at Binance, the company will be offering its loan services via three key financial avenues including:
Cryptocurrency to fiat
Cryptocurrency to stablecoin
Cryptocurrency to cryptocurrency
Additionally, the crypto asset that will serve as the guarantee for all of the credit will be Binance’s native coin offering called ‘Binance coin’.
While some rough edges still need to be ironed out in relation to this latest move made by Binance, if crypto backed loans do become a reality in the near future, traditional banks will have to really change the way in which they work so as to keep up with this rapidly-evolving market space.
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