FTX pic

Posted by & filed under Cryptocurrency.

In this review we were looking at the FTX cryptocurrency exchange and in particular their margin lending facility.

This is an option whereby you can lend your cryptocurrency to other users on FTX for margin trading and earn interest in return.

We initially chose to lend on three tokens: the Australian Dollar (AUD), Canadian Dollar (CAD) and US Dollar (USD). More recently we chose to lend the stablecoin USDT (US Dollar Tether) and Binance Coin (BNB).

You lend by the hour, and there has to be someone willing to take up your offer for the upcoming hour.

Here are the results for our review by token and amount lent:-

  • AUD: $100 lent, $0.60 earned
  • CAD: $124 lent, $1.08 earned
  • USD: $45 lent, $0.31 earned
  • USDT: $147 lent, $0.04 earned 
  • BNB: $150 lent, $0.26 earned
  • TOTAL EARNED: $2.29

You can view full results here.

From an initial deposit of $270, that leaves a return of just under 1%, which isn’t particularly exciting.

Overall we feel that the margin lending facility has potential, but with rates changing all the time it does require a lot of monitoring and is not the kind of passive income we tend to look for. As lending is by the hour, you can make a good return for a few hours but then have no request for lending for a few days.

Plus you have to factor in fees of exchanging tokens for the ones you want to lend on – which as we say can change a lot depending on the rates being given for various tokens.

So in the end we are awarding this a NEUTRAL rating as although in theory it seemed to offer very high rates of return, to achieve actual returns like those over a week, month or year is pretty difficult in practice and would require almost constant monitoring.

Plus of course you have all general risks with cryptocurrency such as the exchange being hacked or going bust and there could be currency risks depending on which tokens you choose to lend. Given the returns we achieved, we feel there are probably better options out there for a higher return.

Please note this review only relates to the margin lending facility though, the FTX exchange itself is quite nice and has lots of options for traders, good liquidity and has been expanding its volume quite considerably in recent times.

 

 

 


FTX Margin Lending – Results Update

23rd July 2021

In this review we are looking at the FTX cryptocurrency exchange and in particular their margin lending facility.

This is an option whereby you can lend your cryptocurrency to other users on FTX for margin trading and earn interest in return.

We initially chose to lend on three tokens: the Australian Dollar (AUD), Canadian Dollar (CAD) and US Dollar (USD). More recently we chose to lend the stablecoin USDT (US Dollar Tether).

You lend by the hour, and there has to be someone willing to take up your offer for the upcoming hour.

Here are our results so far by token and amount lent:-

  • AUD: $100 lent, $0.60 earned
  • CAD: $124 lent, $1.08 earned
  • USD: $45 lent, $0.31 earned
  • USDT: $147 lent, $0.04 earned 

You can view full results here.

As mentioned last time there are issues in terms of margin rates dropping and your lending offers therefore not being matched.

In search of some better interest rates we have decided to lend out Binance Coin (BNB) which currently has an interest rate of 8% per year.

Obviously the risk with lending on a cryptocurrency like BNB rather than a stablecoin is that the token could drop in price during the lending period and wipe out your gains, so it is a little more risky. It could of course go the other way, so we will just have to wait and see.

 

 

 


FTX Margin Lending – Results Update

28th June 2021

In this review we are looking at the FTX cryptocurrency exchange and in particular their margin lending facility.

This is an option whereby you can lend your cryptocurrency to other users on FTX for margin trading and earn interest in return.

We initially chose to lend on three tokens: the Australian Dollar (AUD), Canadian Dollar (CAD) and US Dollar (USD). More recently we chose to lend the stablecoin USDT (US Dollar Tether).

You lend by the hour, and there has to be someone willing to take up your offer for the upcoming hour.

Here are our results so far by token and amount lent:-

  • AUD: $100 lent, $0.60 earned
  • CAD: $124 lent, $1.08 earned
  • USD: $45 lent, $0.31 earned
  • USDT: $147 lent, $0.004 earned 

You can view full results here.

As mentioned last time there are issues in terms of margin rates dropping and lending not being available. Therefore we have only managed to have two lending periods for USDT over the past few weeks, which is a little disappointing.

The Australian Dollar has also dropped off, although there have been more lending windows for that coin.

Just a question of keeping an eye on things and seeing if a more favorable coin emerges in lending terms.

 

 

 


FTX Margin Lending – Results Update

4th June 2021

In this review we are looking at the FTX cryptocurrency exchange and in particular their margin lending facility.

This is an option whereby you can lend your cryptocurrency to other users on FTX for margin trading and earn interest in return.

We initially chose to lend on three tokens: the Australian Dollar (AUD), Canadian Dollar (CAD) and US Dollar (USD). These were three with some of the highest interest rates for stablecoins.

You lend by the hour, and there has to be someone willing to take up your offer for the upcoming hour.

Here are our results so far by token and amount lent:-

  • AUD: $100 lent, $0.52 earned
  • CAD: $124 lent, $1.08 earned
  • USD: $45 lent, $0.31 earned

You can view full results here.

One of the issues that’s cropped up since our last update is that the lending rates on a number of the tokens has dropped considerably and we have therefore not earned anything for a while as our minimum rate was set above the rates currently available.

For example on the CAD and USD we have not earned anything since 19th May as the lending rates have dropped right down to 0.88% interest p.a. from 20-30% when we started.

We have therefore exchanged those tokens for USDT (Tether) which is currently offering a 9% interest rate.

So you have to keep an eye on your FTX account and make sure you are still receiving payouts. In effect achieving the kind of returns we had been hoping for initially may not be possible if they drop the rates like this suddenly.

We will keep going for the time being though and just take the best stablecoin returns we can.

 

 

 


FTX Margin Lending – Results Update

11th May 2021

In this review we are looking at the FTX cryptocurrency exchange and in particular their margin lending facility.

This is an option whereby you can lend your cryptocurrency to other users on FTX for margin trading and earn interest in return.

We have chosen to lend on three tokens: the Australian Dollar (AUD), Canadian Dollar (CAD) and US Dollar (USD). These were three with some of the highest interest rates for stablecoins.

Basically you can choose which tokens you want to lend on and at what rate, although there is a recommended rate for each token for guidance.

You lend by the hour, and there has to be someone willing to take up your offer for the upcoming hour. It doesn’t need monitoring as such though – you just choose your token and rate and let it run.

Here are our results so far by token and amount lent:-

  • AUD: $100 lent, $0.33 earned
  • CAD: $124 lent, $0.74 earned
  • USD: $45 lent, $0.14 earned

You can view full results here.

It is worth noting that we’ve had a lot more take-up in our Canadian Dollar lending – 265 hourly take-ups versus 143 for the AUD and 109 for the USD.

So on this basis at the moment it looks like the CAD is the best to lend on.

We do like the passive income element of this and the potential for very good returns, although as noted below there are risks as well.

Anyway, so far so good for our review of FTX’s margin lending facility.

 

 

 


FTX Margin Lending – New Review

22nd April 2021

We are starting a new review today of a cryptocurrency exchange called FTX.

This is a relatively new exchange, having launched in May 2019. However, it has grown very fast to be one of the top cryptocurrency exchanges, now account for over $20 billion in trading volume per day.

It also has its own token, the FTX Token (FTT), which is the 30th largest cryptocurrency at the time of writing (according to Coinmarketcap), with a market cap of $4.9bn.

FTX focuses primarily on the derivatives market, but offers a number of other trading options like spot trading, futures, leveraged tokens, staking and even stock market tokens.

The feature we are most interested in for the purposes of this review however is their margin lending.

This is an option whereby you can lend your cryptocurrency to other users on FTX for margin trading and earn interest in return.

Some of the interest rates are exceptionally high, with up to 30% interest being offered on certain tokens.

So we are going to take a look at just how this works, whether those returns are actually achievable and any other aspect of this service to be aware of.

As with all opportunities like this, particularly in the world of cryptocurrency, there is of course risk. There are risks such as the exchange being hacked or going bust and there could be currency risks depending on which tokens you choose to lend. So please do your own research and be aware this is not financial advice as we are not financial advisors.

FTX say that lenders bear no counter-party risk though and that FTX guarantees interest payments for however long your funds are borrowed, even if the borrower gets liquidated. So if that information is correct, at least that aspect of the transaction is covered.

Anyway, we will be starting our journey in lending out some tokens today and will report back soon on how it is going.

In the meantime you can check out FTX for yourself here and get 5% off fees by using this link. 

 

 

Leave a Reply

Your email address will not be published. Required fields are marked *