Blog Misc Kucoin Lending Review: Lending Tutorial, Interest Rates & Risks

Kucoin Lending Review: Lending Tutorial, Interest Rates & Risks

date May 29, 2022 time 5 min read 418 views

Among the impressive features offered by KuCoin – a cryptocurrency exchange is Kucoin lending which is an investment strategy that allows individuals to lend cryptocurrency in exchange for interest rates on the lent amount. 

Aside from the rapid advancement of science and technology, artificial intelligence (AI), blockchain technology is making significant strides and shows no signs of slowing down. According to Deloitte’s 2021 global blockchain development survey, nearly 76% of executives polled expect digital assets to be a feasible alternative to exchanges in the next 5-10 years. This technology has also resulted in the creation of Kucoin.

KuCoin is a cryptocurrency exchange that allows users to buy, sell, and trade cryptocurrencies. Kucoin, launched in 2017, has a long list of notable accomplishments. In 2021, the KuCoin platform experienced exponential growth in a variety of areas, including a 3100% increase in the price of KCS, 500+ new listings on the platform, and the breaking of 10 million user numbers at the end of November that year.

Kucoin provides access to over 600 cryptocurrency tokens. Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), Solana (SOL), Polkadot (DOT), Polygon (MATIC), and Cosmos (ATOM) are some of the more popular coins available on this platform. This is one of the few exchanges to issue its own cryptocurrency called KuCoin Shares (KCS), a token issued on the Ethereum blockchain under the ERC-20 standard.

In this article, we’ll help you understand Kucoin Lending, a lending tutorial on Kucoin, Kucoin interest rates and Kucoin lending risks in the most detail. Hope this article will partly answer your questions related to Kucoin Lending!

Kucoin Lending Overview

Among the impressive features offered by KuCoin is the Kucoin lending function. Kucoin lending is an investment strategy that allows individuals to lend cryptocurrency in exchange for interest rates on the lent amount. Users who need to borrow money are matched with the best lenders. When the transaction is matched, the borrower receives the funds, and the lender earns the specified interest. 

There are 160+ cryptocurrencies and stablecoins supported for lending on Kucoin. And the rates of return can be quite high, with a current APR of 40%+ for USDT.

Step by Step KuCoin Lending Tutorial

After 2-minute signing up, let’s go to the procedure of lending on KuCoin:

Step 1. The available assets in the main account are lent to borrowers.

NOTE: The assets in the trading account cannot be directly lent. If you would like to lend out, please first transfer your cryptocurrency to the main account.

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Step 2. The lenders enter the Kucoin Lending Markets page and open the order. 

The lenders only need to fill in the Loan Amount and the Daily Interest Rate (Interest rate range is from 0 to 0.2%) and the Lend Terms selection could be 7 days, 14 days, and 28 days. The default lend term is 28 days.

When you’re lending on KuCoin, you will have the option of choosing between two lending types: Manual Lending and Auto-Lending:

  • Manual Lending

After the funds are returned, they are not lent again automatically. You need to do it manually and the borrower can return them at any time, regardless of the duration of the term.

  • Auto-Lending

Once the funds are returned, the system will automatically lend out the available funds at the priority interest rate. If the current priority interest rate is lower than your predetermined minimum day rate, the system will place the lending order at your predetermined rate.

By enabling the Auto-Lend option, you can take advantage of this option. If you want to lend all of your assets, set the reserved amount to 0.

When the balance in your Main Account exceeds the amount reserved, the system will automatically lend out the excess funds.

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Step 3. The open order is successfully released and the order enters the lending market and Open Orders. Open orders only show up the orders which have not been matched completely.

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Step 4. After the order is matched, it enters the Unsettled page and becomes a loan.

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KuCoin Interest Rates 

Interest rates on KuCoin can simply be understood as a percentage calculation of the returns from the amount of investment. KuCoin offers up to 300% APR (Annual Percentage Rate), but usually interest ranges from 6-12% with some specific cryptos peaking at 50%-70%.

Risks of KuCoin Lending

We are all aware that all investments carry some level of risk, but KuCoin Lending is a relatively low-risk product. Before lending on Kucoin, please go through some following risks:

  • The crypto market is not fully regulated – Because the crypto sphere is mostly unregulated, debt collection may be difficult if the borrower chooses to default on the loan. Kucoin Lending has put safeguards in place to ensure that lenders get a good return on their investment. However, if a loan default occurs, the process of recovering your assets or interests can be quite complicated.
  • Transactions without borders – Normally, this is a significant benefit because crypto introduces you to a completely new market. However, when it comes to cryptocurrency lending, this opens the door to potential abuse. Following up on a debt in another country can be exhausting. KuCoin Lending has put safeguards in place to prevent this, but it is still a risk to be aware of.
  • Extreme price volatility – Crypto and price volatility go hand in hand, the prices could swing against your favor and greatly undermine the value of your investment.
  • Hacks and thefts – Holding and lending your Crypto on a platform like Kucoin comes with the risk of theft. KuCoin is very secure but it’s still on many hackers’ target lists. KuCoin has a long and successful history of keeping its customers safe and satisfied.

Who’s suitable to use Kucoin Lending

Investing in cryptocurrency in general is a good business if you are on the right path and with the right platform. If you’re a more advanced crypto investor looking to earn extra tokens by lending your crypto to others, or if you want to trade cryptocurrency futures and leveraged tokens, KuCoin lending may be a good option. This exchange is not suitable for beginners, who will need to get used to the un-intuitive interface, as well as those who are not crypto enthusiasts.

In a nutshell, while Kucoin Lending does pose some risks, it is still a relatively risk-free cryptocurrency lending channel. As of now, no attacks on the system have occurred, and users are protected by a variety of personal authentication tools. Furthermore, before making any transactions, users must always enable 2-factor authentication (2FA) to ensure the security of their accounts. Kucoin, in general, and Kucoin Lending in particular, seem to be on the upswing in the near future.

LENDING CRYPTOCURRENCY WITH CONSTANT

Beside Kucoin Lending, Myconstant is also a reliable platform for you to lend cryptocurrency. In Myconstant, you can use your cryptocurrency as collateral to obtain instant crypto loans with low-interest rates, allowing you to purchase various cryptocurrencies.

Besides offering loans against 75+ different cryptos and fiat to stablecoin conversions, we offer a wide range of tools for earning interest and trading your crypto.

When not on loan, you can invest your idle cryptos and earn a generous 9% APY through our crypto lend feature. You can use your profits to repay your loan. You can even repay early for a lower interest.

Other benefits include:

  • 24/7 customer service.
  • Rates as low as 6%.
  • Instant matching.
  • Store and borrow against over 70+ different cryptocurrencies (such as qtum coin, BNB, bitcoin, harmony crypto, MCT Token, etc).

Sounds interesting? Sign up for a free account today and start investing Kucoin.

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George Schooling

George Schooling

Invite friends and you both earn 10 USDT when they first lend stablecoins or make a crypto-backed loan

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