Lending

[top]Borrower

The borrower is the margin trader who takes a loan to speculate on the market, funds will displayed on the trading wallet

[top]Lender

The lender is the depositor who gives loans to traders, funds will displayed on the deposit wallet

[top]Borrowing

This feature allows the user to demand credit in advance, so they don't need to go on the open market and get the credit. They can post a demand for credit and after the demand is filled, they can use that credit when they want.

[top]Market demand

When using this, the borrower “buys” credit at whatever the market offers, so his demand for credit can be filled at different interest rates

[top]Limit demand

Using this, the borrower sets how much he is willing to pay for credit.

[top]Costs

The borrower pays the interest from the moment his demand gets filled no matter if he use the funds or not.

[top]Posting Demand

[top]Amount
The borrower sets the amount of money he wants to borrow.
[top]Interest rate
Here the borrower puts how much interest he is willing to pay.
[top]Period
The borrower sets the minimum amount of time he wants to take the loan, so if borrower wants 100 USD for 14 days, lenders need to give him the 100USD for at least 14 days.

[top]Lending

The lending feature on Bitfinex allows users to lend money to other users. Any borrowing or lending are done by other users. The platforms do not provide funds for trading. In order to keep a balance in the market the platform will never give money to users. This means funds need to be saved and given away in the form of loans.

[top]Market offer

When a lender sells credit using a market offer he will be filled at variable interest rates based on demand.

[top]Limit offer

When a lender uses a limit offer he is willing to sell credit only at a certain interest rate.

[top]Gains

Lenders start earning money when someone takes their offer. If nobody takes their offer, they don’t earn interest. Interests are calculated every hour, and credited on deposit balance every night at 00:00 GMT.

[top]Posting Offers

Depositors or lenders have the option to post lending offers so users can take this money and trade for a set amount of time.
[top]Amount
The amount in USD or BTC are you willing to lend so other users can leverage trade.
[top]Rates interest
The interest rates are set per 365 days, even if the loan is for a short time frame. Interest rate payments are calculated every hour, and credited on deposit balance every night at 00:00 GMT.
[top]Variable interest rates
"Variable interests rates" credits are a special kind of credits: they are based not on an agreed fixed rate, but on the average rates of total credits as displayed here. The variable average rate varies every 1/4 an hour. The advantage is that interests rates tend to follow bitcoin price: when the price goes up, interests for USD tend to go up, and similarly for BTC interests rates when price goes down. Lenders can then safely lend knowing that they won't miss opportunities if the interests goes up. Traders will find it even more interesting, because if the interests rates they pay goes up, that usually mean their position become profitable.
[top]example
loan 1 is 10 USD at 10% APY
loan 2 is 10 USD at 30% APY
then the VIR is 20% if there will be taken a loan 3 for volume of 100 USD at 50% the VIR will go UP to 45% ( 10 * 10% + 10 * 30% + 100 * 50% / (120)= 45% )
[top]Maximum period
This is the maximum number of days the lender is willing to lend the money to margin trading users. (3 January 2013)
[top]Auto-renew offers
This options allows you to repost the offer automatically if the trader paid the loan before expiration or if the maximum time limit is reached. The auto-renewed offer uses the same conditions as the original offer. (3 January 2013)
[top]Don't renew loan
This option is used by lenders to cancel offer renewal when the maximum time is reached, or if the loan is paid before expiration. (3 January 2013)

[top]Auto-lending

How it works:
When this feature is on, an offer will be posted with all your available balance. If this balance varies (for example when you get your daily interests), the offer is updated. You can choose the rate and the maximum period of this automatic offer.

How to activate it:
On the lending page, you'll find a new button to activate or deactivate this feature.
Set your desired rate (fixed or variable), set the maximum loan period, and click on "Activate auto-lend".
It can take up to 15 minutes for the automatic offer to be posted, that's normal.

You can of course turn it off any time, it will cancel all active offers.

[top]Offers history

Your offer history is saved and shows on the history part of your account https://bitfinex.com/offers/. (3 January 2013)

[top]USD Credit book

This will show how much USD are available now in the lending section. Conditions are set by users not by Bitfinex. (3 January 2013)

[top]BTC Credit book

This will show how much Bitcoins are available now in the lending section. Conditions are set by users not by Bitfinex.3 January 2013

[top]Fees

Bitfinex does have a fee for the lending for more details go to fee page. (3 January 2013)
Created by , 29th January 2013 at 12:15 AM
Last edited by , 31st January 2013 at 03:56 PM
0 Comments, 2,765 Views

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