There are ways in which users of the FTX cryptocurrency derivatives exchange can passively earn money. This essentially means that they would let the cryptocurrency they already have in their wallet balance do the work for them, which in turn means that they would passively earn money hourly, even in their sleep. We’ll go over everything you should know about the FTX Loan Program, from how it works, to how you can utilize it and create an additional passive cash flow for you.
How does the FTX loan work?
Users of the FTX exchange can borrow assets, and in doing so, they can specify the amount they would like to borrow and the minimum interest rate they would require. Merchants typically borrow funds with the aim of increasing their purchasing power, which in turn allows them to purchase a greater amount of cryptocurrencies. As long as they have enough margin, they can borrow simply by spending beyond their account balance. When a user borrows funds from the cryptocurrency posted by a lender, an action that happens when the interest rate is below the marginal rate, the lender will receive the marginal interest rate per hour. Note that lenders do not assume any counterparty risk, and FTX guarantees interest payments for as long as the funds are borrowed, even in cases where the borrower ends up being liquidated. There are a few things you need to keep in mind before borrowing your funds, including: The funds you are borrowing will be locked. You may not withdraw, sell or use them as collateral. These funds can be used as maintenance margin to avoid liquidations. However, if you want to withdraw your funds, you first need to click on “Stop Lending” and your funds will be made available at the next funding time, which is once every hour. If you as a user were offering to borrow your coins but they were not actually borrowed due to the fact that there is not enough demand at your minimum interest rate, then in that case you are free to use the coins and stop try to borrow at any time.
Borrow your cryptocurrencies on the FTX Exchange: a step-by-step guide
Any user of the FTX cryptocurrency derivatives exchange has the option to earn interest on their cryptocurrencies by lending them to other users who need them.
Step 1: create an account – If you don’t have an account, you can sign up for FTX.com here. If you already have an account, you can proceed to the next steps.
Step 2: Visit Margin Lending Section – For you to lend a cryptocurrency asset, you first need to access your wallet, after that click on “Margin Lending”.
Step 3: select currency – here, you can use USD and cryptocurrencies such as UDT, BTC, ETH, 1INCH, AAVE and so on. For this example, we will use USD as it has the highest 24-hour lending average, meaning it is the most popular currency borrowed.
Step 4: Specify Amount – After clicking on the currency you are interested in lending, you will see an additional menu. This is known as the “Create Funding Offer” part of the page, where you specify what type of offer you want to provide in terms of borrowing your funds for margin trading. Here, you need to fill in the following information: Currency. The amount. Minimum Hourly Rate. Minimum Annual Fee. The rate you provide specifies a minimum, and if the prevailing borrowing rate is higher, you will still receive that higher rate on any funds you borrow. However, remember that you can cancel your offer at any time, but if your funds have been borrowed, they will remain locked for up to one hour after the offer is cancelled. This is due to the fact that all loan fees only last for 1 hour and every hour they reset.
Step 5: Earn money – If your asset ends up being borrowed, you can earn a marginal hourly interest rate. Once your funds are borrowed, you can navigate to the Loan History section of the page, where you can view your hourly earnings.
note: By clicking the icon next to the FTX logo at the top of the page, you can view the “Borrow/Lending” page.
On this page, you will be able to see the total notional amount borrowed in the last 24 hours, along with the most borrowed currencies, the previous borrowing rate, as well as the next estimated borrowing rate.
Final considerations
I hope that through this guide you are one step ahead of the curve when it comes to using FTX exchange as a means of lending cryptocurrencies and earning passive income as a result. This program provides an excellent way for anyone to start earning money passively using funds they already have in their cryptocurrency wallets. Through FTX Lending, you will be making money while you sleep, and this is a method of earning passive income that is popular with some of the more advanced cryptocurrency traders and investors.