Banks don't pay interest, cryptocurrencies even 7%. An advertising slogan to attract new readers? No, what is really happening and here I explain how and where.
Having a bank account can cost zero, as well as 5 - 6 euro per month, and just to have the current account.
The interest is zero on the current account and even if it were profitable, the taxes will eat everything.
Alternatives? Postal savings bonds, digital name book, strange wallets where you can deposit even just 5 euro a week, but the interests are ridiculous and the taxes ...
There is the online trading option (stocks, commodities) but the risk for capital is high, and in any case, a prudent investor profile is preferred.
The answer is therefore always the same: You have a prudent profile, you cannot expect high interests. If you want more, you have to risk it.
The one just described is the traditional world, then there is the world of cryptocurrencies and it is this new world that I will tell you about here. Of lending services, which translated into Italian does not do well because it means loan, but this word, written like this, would suggest that I am about to propose a loan to be requested. Instead it is the exact opposite, with cryptocurrencies it is you who become the lender: lender, lender.
With cryptocurrency lending, the roles are reversed.
How are the roles reversed? Take some time to read and you will discover new, digital opportunities.
Cred (US) LLC is a licensed lender and allows some borrowers to earn a yield on cryptocurrency pledged as collateral. Cred (US) LLC also rents cryptocurrency from users and pays rental fees calculated as an interest rate yield. The yield feature, whether as part of a pledge or a rental agreement, is sometimes referred to as “CredEarn.” Outside the United States, Cred Inc. accepts loans of cryptocurrency from non-U.S. persons and pays interest on those loans. Neither Cred Inc. nor Cred (US) LLC sell or offer to sell investments or securities; neither entity is a bank and no transaction or arrangement provided by either entity is guaranteed or insured by the FDIC or any other governmental entity. Cred makes no representation regarding its creditworthiness or financial position. Cred can extend the term of any loan, crypto rental or pledge in its discretion. “CredBorrow” and “crypto line of credit” (abbreviated “C-LOC”) are trade names for lending products of Cred (US) LLC. This communication may not be used to offer or sell anything in any jurisdiction if doing so is not lawful. All loans by Cred are made or arranged pursuant to California Finance Lenders Law License 60DBO-91480.
13/11/2020 – Affidavit/Declaration of Service Filed by Donlin, Recano & Company:
From this filing we learned the structure of Cred’s business, a history of the company, their corporate and capital structure and the events leading up to the Chapter 11 bankruptcy filing.
Nature of Cred’s Business
Cred’s Business Structure
Customers transferred crypto to Cred, which they generally sold and then invested the dollars in different ways to generate revenue. Cred would then use the yield from their investments to pay a return to the customers, e.g. via crypto interest rates in CredEarn. To get returns, customers had to commit their assets for fixed periods of 3-6 months. Cred didn’t make it clear how LBA, their “utility token” to get premium rates, fits into their business model.
CredEarn crypto interest rates
History of Cred
Daniel Schatt and Lu Hua founded Cred in 2018 after having previously met whilst both working at PayPal. Cred launched with their first partner, Uphold, in early 2019.
Cred’s Corporate Structure
Daniel Schatt and Lu Hua each own 50% equity in Cred. There are four wholly-owned subsidiaries, all of which are incorporated in Delaware and operate in California, except Cred Puerto Rico LLC:
- Cred (US) LLC
- Cred Capital
- Cred Merchant Solutions LLC
- Cred Puerto Rico LLC
Cred’s Capital Structure
As of 9th November 2020, Cred owed approx $140million to customers. However this fluctuates with crypto prices in the sense that the higher the price, the more they owe. Therefore as a result of the latest crypto market rally this figure could be significantly higher
Events leading to Chapter 11 Bankruptcy Filing
CEO Dan Schatt basically blames two causes for the difficulties Cred faces:
- Former Chief Capital Officer, James Alexander’s, alleged fraudulent behaviour that led to significant losses of customer funds. This includes misappropriation of funds, lack of due diligence and ongoing legal costs to litigate against Mr Alexander.
- COVID-19 restrictions drastically reducing revenue and the Black Thursday Bitcoin price crash and subsequent fallout as a result of being improperly hedged.
I AM A CREDEARN CUSTOMER, I WAS DISCUSSED BECAUSE I HAVE BEEN FRIED AND LOST MY CRYPTO-CURRENCIES FOREVER AND IT ALL STARTED WITH THIS UPHOLD MESSAGE
Uphold has discontinued its relationship with third-party crypto lending provider Cred.
What does this mean for you?
- You can no longer link your Uphold wallet to Cred
- You can still receive redemption payments from Cred into your Uphold wallets for your CredEarn programs
- To access your Cred balance, please go to the Cred App
- Your Uphold balances will always be shown on the Uphold app
- If you have questions about your Cred balance, please go to: [email protected]
since I started depositing on Credearn I had accumulated so many cryptocurrencies and it makes me very sad to think of having lost them...
it's not fair !!!
0.10 ETH
$ 59
888.2394436 TRX
$ 27
0.13575983 BCH
$ 39
86.66 XRP
$ 53
0.55245773 LTC
$ 48
0.0235095 BTC
$ 449
617.006681 BAT
$ 147
FOR A TOTAL OF MORE THAN 800 DOLLARS AT CURRENT EXCHANGE RATE
