Allowing Blockchain Loans with Low Collateral

ePrint Report: Allowing Blockchain Loans with Low Collateral

Tom Azoulay, Uri Carl, Ori Rottenstreich

Collateral is an item of value serving as security for the repayment of a loan. In blockchain-based loans, cryptocurrencies serve as the collateral. The high volatility of cryptocurrencies implies a serious barrier of entry with a common practice that collateral values equal multiple times the value of the loan. As assets serving as collateral are locked, this requirement prevents many candidates from obtaining loans. In this …

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