How to Lend Uniswap?

(Last Updated On: )

Uniswap is one of the fastest-growing cryptocurrencies in the market. In the three years since its release, it has seen immense growth. This article discusses all you need to know about Uniswap, Uniswap lending, why you should take a Uniswap loan, steps to taking that loan, and what tokens you can use as your collateral. 

Uniswap is a decentralized trading protocol where you can transact without yielding control of your account details. In place of an order book, the platform uses liquidity pools to facilitate trade. The protocol was created by Hayden Adams in 2018. Adams, a junior car engineer at Siemens, had been laid off from work after a year. He started working on an AMM (Automated Market Maker) in 2017 after a friend introduced him to Vitalik Buterin’s article on on-chain decentralized exchanges. Today, sometime in early January 2022, Uniswap’s governance token, UNI, has $12 billion in market capitalization. The coin’s price also hovers around $18 in the same period.

In terms of growth indicators, UNI is favored by market predictions. Coin Price Forecast sees the token rise to $22.09 in the middle of 2022. Price Prediction, on the other hand, places the price of UNI at $25.39 at the end of 2022, with a maximum reach of $30.48.

Additionally, developers of this project have seen no reason to limit it to the Ethereum blockchain as it was recently announced that the protocol would be expanding to Polygon. Uniswap is also leaning into Arbitrum, another blockchain, where it is in its beta stages. With this flurry of activity, the project presents as a forward-looking option to DeFi investors.

What is Uniswap Lending?

Other than selling, lending is one way to earn returns on your crypto assets. Instead of waiting for prices to appreciate before selling, you can make passive income on UNI by lending it to borrowers and earning interest in return. On the flip side, borrowers maximize the value of their digital assets with a Uniswap loan instead.

Why Take a Uniswap Loan?

The following are reasons why you might want to consider a Uniswap loan:

1. Market Capitalization

If the reason you’re taking a loan is to reinvest, Uniswap offers you a shot at this. At $12 billion dollars, the token is ranked among the top 20 cryptocurrencies by market capitalization. This makes it a large-cap project as statistics indicate a substantial trading volume. Therefore, you can take a Uniswap loan, and rest assured that you will find a market for it.

2. Liquidity Mining

When you take a Uniswap loan, you can choose to stake the coin in the exchange’s liquidity pool. There, you earn a percentage from the gas fees paid for trading that currency pair. This strategy will enable you to make returns, pay back your loan, and retain a profit.

3. Price Movements

In terms of price, Uniswap’s growth has been fairly consistent. It has been predicted that the coin will witness an upward swing in the coming years. To take advantage of this, you can get a Uniswap loan and sell at a higher price in the future, helping you hit the bullish targets of your investment.

Steps for Getting a Uniswap Loan

On CoinRabbit, you can get a Uniswap in a few, quick and easy steps. The following are processes to follow when getting a Uniswap loan on CoinRabbit:

• Step 1 – Do a Calculation of Your Loan:

To begin, use any of the various collateral options to set up the loan. Confirm your choice and enter the address where you would prefer to receive your loan.

• Step 2 – Secure Loan without Further Stress:

At this stage, all you need to do is send the collateral to CoinRabbit. You will receive your payout immediately without a KYC process or additional delays.

• Step 3 – Use Your Loan:

Now that you have secured your loan, the next thing is to use it for your financial purposes. While you do this, CoinRabbit will notify you of changes in market rates, if there are any.

• Step 4 – Payback:

When you’re done utilizing your funds, you can pay the loan back to CoinRabbit and regain your collateral. Simply send the payment in full and be deposited in return.

What Crypto Can I Use for Collateral?

The following are some of the coins you can use as collateral on CoinRabbit:

Digibyte:

This token is one of the most innovation-centric tokens today. It does aim to simply participate in the market but lead a revolution in it. To make a difference, the project intends to achieve faster processing speeds, improved security on its platform, and feature on various use cases for scalability. You can use Digibyte as collateral on CoinRabbit.

Ethereum:

Ethereum is a household name in cryptocurrency. It has a high trading volume and is second only to Bitcoin globally. The Ethereum blockchain has been leveraged for developing other crypto projects, making it a long-term player in the sector.

Bitcoin:

Bitcoin has been in the industry for over a decade and it is not set to leave soon. It is the world’s top cryptocurrency and has seen massive increases in price recently. Using your Bitcoin as collateral might be a way to unlock new gains in the asset’s price.

Final Thoughts

An important point to consider in crypto investments is the number of use cases. For UNI, liquidity mining is one of these. You can earn revenue on your staked tokens by putting them in a liquidity pool. Additionally, with favorable price forecasts, Uniswap offers you the opportunity to make a profit.