The ingenuity of crypto and its vast ways of application is something industry experts have upheld as a space of endless opportunity. Generally, people know of crypto and its basic functions, being attracted to the possibility to make money, as currently cryptocurrencies are the most captivating trend in investment at the moment.
Cryptocurrencies and tokens have a multitude of uses which have interjected into the financial world, becoming an everyday phenomenon in investing, buying and selling, securing transactions, and providing an alternative to the standard financial procedures.
Amongst these standard features, more innovative uses of crypto have come to fruition. Such as the process of Crypto Renting, an exchange of cryptocurrency where a holder rents their crypto to a company who reinvests it to gain profits for both holder and company within a set period of time.
What is Crypto Renting?
Crypto renting is a relatively new safe and secure process for crypto holders to gain money. It is essentially like any other renting process where an exchange of goods takes place for a predetermined fee. For instance, renting property, renting land, renting equipment, and, in a simple light, films, like BlockBusters famed film and game renting service.
For blockchain based companies, the process of renting crypto isn’t from company to client, but from client to company. A user rents their crypto to a company by placing their crypto in a their account, similar to a savings account, which holds that crypto, garnering interest, while being utilised by the company to reinvest, and eventually routinely paying the client for their provision after a set period of time.
Crypto hodlers may already have various wallets that hold their different cryptos and are willing to keep them for a longer period of time to see a greater profit. During that time, the prices of their crypto can increase or decrease depending on the volatility of the market, but they will sell them when they consider their assets have risen to a good profitable price.
In the meantime, Crypto renting is a sound operation for hodlers as there is an assured payout from the company holding the funds, resulting in a process that always provides the client with profit. No matter how small, there will always be a return.
How does Crypto renting work?
Entering a crypto renting contract with a company means agreeing to terms with how the process works. Usually, a crypto renting service includes a fixed period of renting the assets to the company and that can’t be tampered with and profits made from their investment can be withdrawn monthly.
With the accumulated funds, companies providing such services have assured ways of reinvesting the crypto - promising their clients returns. Some companies reinvest the rented crypto by lending it to Hedge Funds, exchanges and institutional traders. Renting crypto for the client is essentially earning rewards on your assets. This is most common with banks, but it has become a theme with crypto wallets too.
The advantages and disadvantages of Crypto Renting
So, why get into crypto renting? Isn’t it one of quite a few ways of making money from this era of crypto? With the trend somewhat still in its infancy, is it safe? There are a lot of questions to be asked. Nevertheless, there are quite a few glaring advantages of crypto renting. It is easier to list the most noticeable ones.
Key advantages of crypto renting:
Zero Fee’s - there aren’t any fees or penalties when it comes to renting crypto. It is inviting for small investors, as unlike a lot of crypto trading platforms, which charge to transfer or withdraw crypto.
Small minimum deposits - depending on the selected program there are different minimum requirements, which tend to be not compromising and not a burden for the user, while earning back based on the interest rate.
Flexible payouts and programs - each renting service is unique, and has their own approach to fulfilling its clients investment returns. For instance, Nebeus has 4 different renting programs and each option provides different time terms, rates of interest, and minimum stakes.
Key disadvantages of crypto renting:
Fluctuating Prices - as crypto renting involves locking your assets for a fixed period of time, and taking into consideration the crypto market is highly volatile, prices might rise or dump significantly on that time. Therefore, users should be aware that this is a possibility and if they are pondering whether to sell soon and take a profit, or they are expecting a huge movement of the market, crypto renting will lock their assets and make them unable to trade.
Unclear Rewards - some crypto renting companies take commissions from the interest gained. Due to the fluctuation in their interest rates, if the commission the company takes isn’t fixed, the rewards from the renting service can be questionable. However, in Nebeus is not the case, the reward indicated in each program is the total amount the user receives.
Unclear Reinvestment - the way some companies reinvest their rented crypto should be subject to due diligence. For instance, some crypto renting services have capitulated due to poor investments and rehypothecation. Rehypothecation occurs when a broker pledges a client's assets to facilitate its own transactions with other businesses. It is a practice that is uncommon today due to the volatility of the process, and how it can impact a clients investment - even totally losing their asset to a third party.
Crypto Renting with Nebeus
Nebeus’ crypto renting service is straightforward and an easy way to start earning by renting your crypto. Nebeus uses the assets they receive in their renting service for its own liquidity and internal product development. What is more, Nebeus pays its clients earnings from some of the best rates in the industry considering stablecoins. With 4 different rental programs, each tailored to clients specific needs, Nebeus offers a range of options to help fulfil a client's investment.
Stablecoins renting programs based in USDC and USDT
Bonsai
This program is good for starters as it has a minimum of 50 USDC or 50 USDT deposit with a 5% RPY with 1 month for lock up.
Baobab
Which requires users to lock up from 4 months their stablecoins to receive 8.2% RPY and has a minimum deposit of 1000 USDC or 1000 USDT.
Crypto renting programs based in 10 available coins
Juniper
It is the base program which is best for crypto volatility as it requires only 1 month of established renting period with the possibility to earn 3.5% RPY. The minimum deposit is equivalent to 0.0025 BTC.
Sequoia
This program requires a minimum 4 month period and 0.08 BTC equivalent deposit to access 6.5% RPY.
Moreover, something that is unique to Nebeus is the possibility to choose a different cryptocurrency from the one rented to earn the rewards. In this way, users can avoid conversion fees while gaining their profits on another coin.
What is the difference between Crypto renting and Crypto staking?
Crypto renting sounds similar to crypto staking, and in some ways they are. However there are fundamental differences.
The process of crypto staking is when a crypto holder deposits their crypto into a platform, keeping it in a company’s staking service, earning rewards while helping maintain the Blockchain network - contributing to its processes and helping validate transactions. As a reward for contributing to its maintenance, the crypto holders who stake their crypto receive a payout up to 7.5% RPY that can be withdrawn monthly and with Nebeus they can instantly unstake at any time.
On the other hand, crypto renting is comparable to earning yield on a bank savings account. Thus, their purpose varies as it doesn't contribute to the blockchain’s maintenance. As mentioned, in crypto renting programs users are committed to a previously established lock investment period and cannot modify it once it begins, having to wait till it is over to have the crypto available for other purposes.
Although crypto renting hasn’t got the flexibility of staking, as assets cannot be withdrawn and unstaked entirely whenever the user prefers, it provides greater and more stable returns. Also, by renting crypto in Nebeus, users can gain on another cryptocurrency and avoid conversion fees.
Are you ready? Sign up to start renting your crypto with Nebeus today.
La inversión en criptoactivos no está regulada, puede no ser adecuada para inversores minoristas y se puede perder la totalidad del monto invertido.
