Cryptocurrencies are every day more and more present in our daily lives, displacing some of the most essential services and substituting traditional finance companies while doing so. It seems that the next step for cryptocurrencies is to substitute banks in their role as middle-man institutions to process and give credits. One of the most successful cryptocurrency exchanges is going to do just that. Binance has announced today that they will be partnering with a startup called Libra credit to offer cryptocurrency backed credits through its platform, according to Finance Magnates.
While this is not a new offering because Uphold, another cryptocurrency and investment platform has already signed a similar agreement to offer loans on their platform. But Binance is one of the most prolific and big exchanges in the whole world. While not being even a year old, it is ranked among the top exchanges in volume trade according to Coinmarketcap, a site that specializes in volume statistics. That is why this agreement could be potentially a game-changer for all of the unbanked worldwide.
A credit is something that is easy to get for some people, but for others worldwide is but a dream. Banks, as financial institutions put too many bureaucratic barriers for people to get access to a loan. That is why This initiative by Binance and Libra Credit is so important, to push the boundaries and massify the access of necessary credit to the people that really need it. Binance announced that the loans would be offered in three different ways: Cryptocurrency to fiat, cryptocurrency to stablecoin, and cryptocurrency to cryptocurrency, and the crypto asset that would be used as a guarantee for the credit would be Binance’s own cryptocurrency, Binance coin.
With this move, Binance moves closer to being an integral cryptocurrency “bank”, offering more than just cryptocurrency exchange, a thing that is becoming a new trend for these kinds of businesses lately.