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What’s Crypto Lending? Why Did Investors Get Burned?: QuickTake

July 5, 2022, 3:17 PM

Savers frustrated with the paltry yields offered by banks in recent years appeared to have found a solution: so-called crypto lending accounts that can pay interest rates of 18% or even more. Millions piled into these products, introducing a whole new cohort of investors to cryptocurrencies. Some came to regret their move after crypto lending firms Celsius Network, Babel Finance and Vauld succumbed to a meltdown in digital assets and halted customer withdrawals.

1. What is crypto lending?

At first blush, crypto lending accounts look a lot like savings accounts offered by banks, but with cryptocurrencies instead of traditional ...