🕵️‍ ICO Watch

Crypto-For-Cash Lender Faces Low Liquidity: Past-ICO Review

  • Eric Eissler
    🕵️‍ ICO Watch

    The lending marketplace faces disruption from crypto, but many questions remain

Crypto-For-Cash Lender Faces Low Liquidity: Past-ICO Review
Cover image via u.today


SALT (Secured Automated Lending Technology)  is crypto-based lending company, which for a crypto collateral, will lend the borrower cash. The borrower can then make payments to pay back the loan or forfeit the crypto collateral in exchange for the debt to be cleared.

The idea behind the loans is for long-term HODLers to maintain their long positions, without losing possible profits and to avoid taxes levied against them for selling. Essentially it is a way to make use of crypto’s equity without having to sell it.

Balance the ledger

SALT had a 15-day ICO that ran from Aug. 1 to Aug. 15, 2017, and it raised more than $45 mln from its fundraiser. Its market cap is $75 mln and the current token price is $1.25 down 82 percent from its entry of $6.91 on Sept. 29, 2017. CoinMarketCap ranks it at 121 on its charts. SALT did see an all-time high of $16.72 in January 2018, when the crypto market was experiencing massive investment, only later to experience a massive fall in value over the first quarter of 2018.


Loan sharks?

Traditional loans are the way for many to borrow money with terms and conditions that are regulated by government. Banks are required to be able to meet a laundry list of requirements to be able to lend.

Conversely, there are predatory lenders in the US such as payday loans or automobile title loans, which loan money to often poor consumers, who either pay high interest (20-30 percent) or having their automobile taken to pay the debt.

So how does SALT do it? While not readily available on the website, interest rates on the loans vary between 10 percent and 15 percent, depending on the terms of the loans. When borrowers apply for a loan, the available options are then presented and they can choose among them.

Not the ideal scenario for someone who wants to shop around first before committing to a loan agreement, however, if the borrower decides to split with the cash SALT just liquidates the crypto to get back its cash.

Membership fees to borrow?

SALT tokens are used to pay for your membership in the SALT system; it is a tiered annual fee that varies based on the size of the loan. At the bottom is one SALT that covers up to $10,000 and at the top it is 100 SALT to borrow over $1,000,000 with various tiers in between.

This is rather a new ploy for the lending business, paying an annual fee just to be able to borrow money.


Suspended memberships and low liquidity

In February this year, SALT suspended new memberships and loans. It seemed that low liquidity was an issue. We wanted to learn more but about this challenge, but we were unable to get a response to our questions. Some other interesting things that we would have liked to have known were:

  • How much have you been able to lend since starting?

  • How have repayments been? Do you find your borrowers are repaying or are you keeping the collateral crypto?

These questions, answered, would have given us better insight into how the company operates and how their lending practices are trending in terms of paybacks or asset liquidation.

Competition ventures into new frontiers  

While the lending market is highly regulated around the world, SALT has invented a unique workaround. However, as this type of lending gains more popularity with crypto enthusiasts, SALT could find more competition cropping up to dilute their market share.  


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About the author

Eric Eissler is based in Chicago and works in higher-education administration and finance. He is a freelance writer covering blockchain technology, fintech, cryptocurrency, the oil and gas industry, and international politics.

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📰 News

Ripple's XRP Is in for ‘Explosive Growth’, Prominent Venture Investor Tim Draper Says

  • Yuri Molchan
    📰 News

    A Bitcoin bull and investment guru Tim Draper predicts the calm before the storm for the XRP price, as “to call Ripple developers actions wrong is impossible”

Ripple's XRP Is in for ‘Explosive Growth’, Prominent Venture Investor Tim Draper Says
Cover image via en.wikipedia.org

Disclaimer: The opinion expressed here is not investment advice – it is provided for informational purposes only. It does not necessarily reflect the opinion of U.Today. Every investment and all trading involves risk, so you should always perform your own research prior to making decisions. We do not recommend investing money you cannot afford to lose.

When asking a question about when XRP is going to hit its quickest high profits in the quora.com forum, a user gets a reply from Tim Draper himself, who says that the XRP price is about to experience an ‘explosive growth’.

Tim Draper is pumping XRP

Tim Draper, a prominent venture investor and a Bitcoin bull, seems to be excited by the current Ripple expansion. Judging by his words, he is predicting the XRP to soar in the short term, calling it the calm before the storm or ‘explosive growth’, putting it a different way.

Tim Draper says:

“Looking at the three-time growth of Bitcoin over the past 5 months, one would expect a similar result from XRP.”

XRP should have already grown beyond $0.6 or even $0.9 by now, says the crypto investor, when talking about the results of recent Ripple’s expansions and the partnerships the crypto unicorn has initiated lately.

“The company is actively developing, expanding the sphere of influence, enlisting the support of large financial institutions and constantly improving the technology of transfers.”

Finally, he states:

“In addition, Ripple is owned by SBI, a large corporation with companies such as R3. Everything indicates that the current situation, only the calm before the storm, in our case, before the explosive growth.”


Ripple Opens New Office in the Heart of Washington, DC, to Educate US Lawmakers

Ripple Opens New Office in the Heart of Washington, DC, to Educate US Lawmakers

Ripple expands to Washington, D.C.

Previously, U.Today reported that the crypto giant has decided to expand its presence to Washington, D.C., to be closer to regulators, as per the CEO Brad Garlinghouse, and educate them on crypto and the blockchain.

He stated to Forbes:

“We’re focused on maintaining a dialogue with Washington regulators and policymakers and being a resource to the Hill allows us to be easily accessible at all times.”

Apart from extending its arms to Washington, Ripple has joined the Blockchain Association.


What is your bet on the price moves XRP is going to take in the near future? Share your view in the comments section below!

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About the author

Yuri is a journalist interested in technology and technical innovations. He has been in crypto since 2017. Believes that blockchain and cryptocurrencies have a potential to transform the world in the future. ‘Hodls’ cryptocurrencies. Has written for several crypto media. Currently is a news writer at U.Today.

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