Chinese Exchange Yuanbao Now Lets Customers Mortgage Their Bitcoin
Chinese exchanges have discovered another model in their quest to add new platform services: fiat currency-based peer-to-peer (P2P) loans using bitcoins and other digital assets as collateral.
While most such services are aimed at large bitcoin holders who wish to make use of their holding’s value without actually selling, some exchanges allow mortgaging of other assets like litecoin, car registration and even telephone numbers.
Unlike bitcoin-related P2P lending platforms in other countries, such as BTCJam, these Chinese services do not actually lend digital currencies. Instead, users borrow and lend fiat currency only.
One such service is Yuanbao.com, operated by a partnership between developers of the altcoin ‘yuanbao’ and exchange BTCTrade. Yuanbao.com offers loans in Chinese yuan (CNY) to borrowers prepared to leave either bitcoin, litecoin or yuanbao (the coin) with the exchange as collateral.
This post was published at Coin Desk on October 20, 2014.