Why are interest rates on Bitcoin backed loans so freaking high?
They have your 🌽 which is trivial to take in a default, so why 14%+ interest rates?
Can anyone in the know weigh-in on this? nostr:npub1w69ya7xs697hk3hky3gllryz8rwverfa0ylz89chf9qnhfcskc2s64zltw nostr:npub1guh5grefa7vkay4ps6udxg8lrqxg2kgr3qh9n4gduxut64nfxq0q9y6hjy nostr:npub1qny3tkh0acurzla8x3zy4nhrjz5zd8l9sy9jys09umwng00manysew95gx
it all comes down to liquidity partners
the source of the dollars for the loans sets the rates
they should go down over time, eventually they should be the lowest rate loans available because bitcoin is the best collateral
strike has no prepayment penalty or origination fee so as rates go down, users benefit
Market participants are low. Still tiny market. Will come down over time.
Best explanation I have heard. Guessing we are still 5 years out from favorable loan terms.
Thanks for the response nostr:npub1qny3tkh0acurzla8x3zy4nhrjz5zd8l9sy9jys09umwng00manysew95gx. I was taken back at the rates from Unchained and am failing to understand the why. Hoping the next five years brings sanity to this area in Bitcoin.
That’s great information on Strike. I’ll pass that along.
