Japanese cryptocurrency exchange Bitbank recently announced the launch of a Bitcoin (BTC-USD) borrowing program. The program has been launched to attract new users and supplement the exchange of liquidity. According to a statement from the bank, henceforth the account holders of Bitbank may get a loan of one bitcoin as a part of the lending program of the exchange.
Bitbank To Add Other Cryptocurrencies Soon
Borrowers will receive the loan amount at a predetermined rate of interest. Bitbank says that at the start, it will only allow lending of BTC to interested customers. But the bank is planning to incorporate other cryptocurrencies like Ripple (XRP), Ethereum (ETH), Bitcoin Cash (BCH), and Litecoin (LTC) in the program in the future.
The Japanese exchange is currently placed at position of 31 in the world on the basis of average daily traded volume. Bitbank is the second exchange in the country to introduce such a lending program. Prior to this, in April this year, GMO launched a similar program for BTC. The Tokyo-based exchange rolled out support for other prime digital currencies on month later.
Bitbank To Conduct Extensive Account Checks
As per reports, under the program, users can lend 1 Bitcoin for a minimum 12 months and the borrower will pay interest according to the lent capital proportion. But prior to that, the bank will conduct a recruitment program for a month during which it will conduct a thorough personal and account checks on the interested users.
One of the most important parts of the program is its 12-month-lock period. The notice from the bank says, “The cryptocurrency remain locked during the entire loan period. So, the cryptocurrency cannot be sold or transferred. Only when the loan period is elapsed or returned by Bitbank, the customer will be able to sell or transfer the cryptocurrency.” The lenders will receive a usage fee from the bank for using their funds. For up to 5 BTC, the dividend will be 3% and for those lending more than 5 BTC, there is an increase of only 1% in the dividend amount.