Bybit has launched a new product called Bybit Lending, which enables users to earn interest on their idle bitcoins.
The product works by allowing customers to deposit their unused cryptocurrencies into asset pools, which are then lent to borrowers in exchange for hourly interest.
Bybit, established in 2018, is a cryptocurrency derivatives exchange that provides trading services for various cryptocurrencies, including perpetual swaps, futures contracts, and options contracts. Its platform features advanced order types, a customizable user interface, and risk management tools.
In addition, it offers educational resources and a mobile app.
According to Bybit, Bybit Lending provides users with low-risk and flexible redemption options, allowing them to earn hourly interest starting one hour after the crypto asset is deposited. The product offers a safe storage solution for loaned assets, thanks to Bybit’s strict risk management system.
In addition, Bybit Lending will impose a 20% service fee on the interest income generated by loans, with the remaining 80% distributed based on the proportion of funds lent by lenders in the asset pool.
The Annual Percentage Rate (APR) is a floating rate of return estimated based on lending market conditions and actual interest income, and it is updated in real-time.
When redeeming, the accumulated interest will be paid along with the principal to the user’s Spot Account or Unified Trading Account.
Bybit clarified that the associated risk with Bybit Lending is generally low. However, it’s important to note that users may not be able to redeem their funds immediately if the Loan-to-Pool Ratio of the Bybit Lending asset pool reaches 100% or if the daily redemption limit is exceeded.
Nevertheless, users can still redeem their funds as soon as capacity becomes available or the following day.