Bitbuy, a Canadian cryptocurrency trading platform, has teamed up with the cryptocurrency lender Cred to offer Canadians up to 10 percent annual interest on their bitcoin holdings.
The offering has been launched on a subdomain of Cred’s website. According to a press release issued by the partners on November 4, 2019, a fully developed integration of the offering will be launched in early 2020. The release also noted that interest will be paid every three months and that initial terms will be six months long.
In addition to bitcoin, users can earn interest on other cryptocurrencies like ether and bitcoin cash.
The partnership appears to be an effort by both parties to expand. Bitbuy sought to add lending options for its users and Cred sought to expand its lending business into Canada.
“[Bitbuy] identified lending and savings as a natural next step for our users,” Charlie Aikenhead, Bitbuy’s vice president of marketing and communications, said. “Identifying a partner with experience and regulatory foresight such as Cred has expedited the process and enabled us to provide this product and service to Canadians immediately.”
With the addition of Canada through this partnership, Cred now offers its lending services to users in nearly 180 countries.
The Rise of Bitcoin Lending
Cryptocurrency lending platforms, such as the one forged between Bitbuy and Cred, are becoming increasingly popular. Similar services are offered by the likes of BlockFi, Celsius Network and BitLeague. In general, these options offer interest on cryptocurrency holdings that would otherwise lay dormant, but users have to trust custody of their assets with the providers.
According to Bitcoin Magazine research from October 2019, Celsius has generated over $2.2 billion in loans across 45,000 active accounts with $300 million of assets in custody since its launch in 2017. BlockFi has hundreds of millions of dollars in custody and takes in seven figures of monthly revenue. And BitLeague, likewise, has handled millions of dollars worth of bitcoin on its platform to date.
Bitbuy has identified this growth and it was a motivating factor behind its partnership with Cred.
“As similar products and services become more commonly offered through Canadian platforms, users will be increasingly comfortable using their crypto assets to earn,” said Aikenhead. “Bitbuy wants to play a role in introducing Canadians to the advancing cryptocurrency economy.”
And this may not be the last time the two companies partner on a new offering.
“As the cryptocurrency economy continues to evolve, [Bitbuy and Cred] plan to collaborate on more initiatives and offerings,” Aikenhead concluded.