It is a dapp on Etherum chain which allows p2p lending through Smart Contract. Here no third party sets the rule for the lender and borrower, rather it is the borrower and the lender who formulate the rules, so that either party can get into an agreement through a Smart Contract.
A borrower can simply take a loan in ETHLend by backing his crypto assets as collateral. It is completely transparent, no verification, no paper documentation, no authentication, etc & everything gets executed through a Smart Contract. The collateral can only be released to the borrower when the loan is paid back fully, or to the lender in case of collateral call or when the loan wasn’t fully paid back at the end of the loan time. In case the borrower defaults, the lender can be able to liquidate the collateral. A borrower is at the liberty to prematurely close the loan at any time.
LTV(Loan to Value) for all crypto assets is 50% where as for LEND tokens it is 55%. However if the collateral worth decreases below 50%, then it would trigger a notification call to add more collateral. So ideally the LTV has to remain equal to or greater than 50%.
The fees in this platform is 20% of the interest on the lender side and 2% origination fee on the borrower side(in first installment only). In case of default, the platform fee is 5% of the collateral amount.
It is true that cryptocurrencies are highly volatile. So planning and taking a loan in crypto terms may be or may not be advantageous and it generally exposes to extra bit of risk. Considering this fact, ETHLend also allows users to to receive or fund loans pegged to fiat currencies and that definitely helps to account for volatility.
Collateral & Loan option
At the moment, ETH lend accepts ETH, BTC, LEND and more than 180 liquid ERC20 tokens as collateral. One can avail loan in various options like: ETH, LEND, DAI, TUSD, ETH pegged to USD, EUR, GBP, INR, KRW, JPY and CNY.
Advantages of ETHLend platform:-