Crypto lending platforms (Celsius) boomed during the COVID-19 gaining popularity among institutional investors in search of high-interest rates and easy access to loans.
Lenders' business model came under scrutiny after a sharp sell-off in the crypto market spurred by the collapse of major tokens terraUSD and luna in May.
U.S.-based cryptocurrency lender Celsius Network announced it filed for bankruptcy in New York, becoming the latest victim of a dramatic plunge in token prices.
Voyager Digital Ltd and Vauld lender also filed for bankruptcy this month after suspending withdrawals and deposits of Investors' money.
Here are the 3 best solutions to stay safe in the crypto market and protect your money if your cryptocurrency lending platforms go bankrupt.
Custodial wallets are managed by third parties and only allow investors to send and receive money, non-custodial wallets are services that give the full command of crypto assets in the hands of users.
In a non-custodial crypto wallet, the user is the manager of his or her crypto assets. The security levels in custodial wallets are high and vulnerable to hacks.
Another medium is also blockchain-based apps, Decentralized crypto exchanges (DEXs), that offer lower fees and allows customers to hold their crypto assets directly, and eliminates bankruptcy burden.
Decentralized Crypto Exchanges:
1. Defi Swap,
We don't know where the blockchain & cryptocurrencies are going. So be rational — never lose your hard-earned savings in a volatile market, and make sure that you have a diversified portfolio.