LEND Your XRP to Uphold and EARN? Good or Bad idea?


Hey, so today on my live stream we were talking a little bit about uphold and upholds relationship with cred and offering up credit offering up interest to money fiat currency or Digital assets that are put on the uphold exchange and I want to talk a little bit more about that today Hey, this is Jeff with the hata report and join me on today’s video as we dive a little deeper into the uphold Cred relationship. And again, let’s look exactly at what they’re actually offering to us So let me turn over to look at the uphold website Alright, so right here, we’re going to go through kind of step by step I want to look at some of the updates if you guys haven’t really looked into it in a little while And I haven’t really dug into the uphold website For a little bit. I’ve been using the app primarily but let’s scroll down here. I think this is really interesting I like using uphold. I think it’s a great solution for Easy investing for it’s easy buying of digital assets But if we look here you’ll notice that they’re supporting 23 fiat currencies 9 crypto currencies or digital assets and for precious metals So some of the new things that are going on with uphold right now If we look primarily what we’ve known uphold for as a digital asset exchange easy funding instant conversion Blockchain access obviously here’s what’s new earn and we heard about this a little ways back But this has all been coming on live over the past couple weeks, but actually just in the past few days. They’ve actually given permission to provide this as a solution In the US and in 28 states now, I’ve looked everywhere on the website I’ve looked everywhere through the FA cues and it’s very very limited in the amount of information. That’s actually Available now the other part he the other component is Baro now we’re gonna dig a little bit more into what the urn means because there actually there’s actually a Relationship again as I’d mentioned with uphold and cred and we’ll take a look at cred here in a second now the Baro section access to low-cost credit secured by your digital asset currency or digital currency Holdings I think between earn and borrow uphold is really making a big progression away from digital exchange to full-on bank Solution I mean in terms of if we really dig into that the core principle of a bank put your money in the bank Hold your money somewhere. That is in a bank. That’s safe. Secure Allows you to earn interest and allows you to borrow now in this case. You’re not able to borrow on credit You’re borrowing based off of holding your digital asset as collateral now in the earning side You’re putting your digital asset up into a six-month hold To gain somewhere between three to ten percent and we’re gonna dive in a little bit deeper into what that actually means And really which digital asset you’re going to be benefiting from if you decide to do that We’re gonna look at the pros and the cons Now the said the third Section here is debit card and I think this again this is very interesting and we’re seeing a trend in the space early on the live stream We also talked about Bab Bab B and their backs coin the Bab app if you go check that out They’re getting into the micro economy micro payment space micro banking We’ll talk about that in another video And here where the debit cards really allows you to use your digital assets or really using any of the currencies That you hold on uphold with the debit card There’s no other information about it other than what it says here as coming soon Now, let’s go over and take a look at Cred. Okay, so over here what we’re gonna look at now. This is the relationship. There’s an API connection Essentially outpolled is a partner with cred to really extend the interest earned on the digital asset Holdings your Individual login on uphold once you go through the process to gain access to credit will give you access to cred Its whether really making a determination as to whether or not you want to open up Your your access via, even if it’s via API, even if it’s a one-way communication Unknown because as much as I’ve dug in again I can’t find all of the details in their FAQ s and they’re About us really there’s not that much information really to make a good determination out. I love the concept I think it’s a great idea but again The pros is that we’re seeing a really a blurring of the lines between the digital exchange and a traditional bank concept and we’re starting to see some of the banks blurring into the digital asset space as well in terms of what JPMorgan is doing with the jpm.n Look at credit I like this statement a better way to earn and borrow own your own financial future Earn interest or borrow with your digital assets now on its face. It looks great That’s a great concept on but again They really don’t get enough into detail to give us what we want to say. Am I secure? What’s the process and for that we’re gonna go into an FAQ that uphold Put out but here put your money to work for you as it was meant to save your crypto assets or an interest and borrow cred earn up to 10% annualized interest rate on your crypto are stable coin now if it’s just sitting there and You’re not gonna do anything with it and you don’t anticipate any big Hikes and in pricing, you don’t anticipate the bear market turn into a bull market and wanting to sell Hey, you know what if your digital assets are just sitting and doing nothing? You might as well earn interest now, you would also want some form of security to back that up You want some insurance to know that if something happens that they’re going to? Provide you with your digital assets back and the interest that they owe you now here don’t park your investment without earning That’s an interesting concept now cred borrow the best of both worlds Hold your crypto walk gaining access to liquidity through their credit line again Exactly. What up? Hold is offering because they’re partnering with cred This is putting your digital asset as a collateral for the loan which kind of makes sense if you don’t have credit Then you can have you can instantly get some form of credit again holding your investment as collateral so you don’t need to come out of pocket with more money now on the on the Downside of that or the plus I you can look at it. Either way. This is your money. They’re holding or your investment They’re owning is collateral You’re incentivized to want to get that paid back as soon as possible, but then you gain access to it back so you’re essentially paying them a Percentage to basically borrow against your own savings, which is a nice way of doing it. Here’s the interest I know I’m fulfilling. I’m putting my money back into My own bank account and as it’s an investment Inevitably the anticipation is that it’s going to increase in value. So you kind of gain Twofold however, again, you want to make sure that it’s secure do you want to make sure you’re paying a back? You also want to make sure that you’re not Anticipating some big bull market where you don’t want to get out of it or sell it or what have you? I’m so really there’s there’s a lot of decision-making When when it comes to borrowing against your own? investment there So what is cred earned credit is a financial product that allows owners of crypto assets to earn interest on their crypto holdings We talked a little bit about that right on the website. What do you do with my crypto assets cred offers? Crypto lending on collateralized or guaranteed basis. Your crypto assets are used to lend. So that’s what they’re going to do They’re gonna lend out Your crypto assets. So that’s the the flip side of it. How do I know? They’re safe now? This is an interesting question because it’s gonna be followed up with the fact that it’s not FDIC backed which is from an insurance perspective if something happens to cred we’re concerned about what happens to The individual digital asset, but what if something happens to Craig but here how do I know? They’re safe Craig works with various federal agents and leading service providers to ensure the safety of your assets So during the wrists don’t risk something during the loan term Craig managers Hitches, its risk by employing a hedging strategy. So again, this is just Determining the risk of your investment assuming that nothing happens to cred. So let’s keep going down this list Do I need to create an account with credit now you do but if you’re already on uphold you can use the same login credentials through an API But they’re still going to require additional information under enrollment for kyc and AML verification only so only customers who complete and successfully pass the verification are Eligible to participate so first steps first you have to really decide if you’re comfortable Creating the link between uphold and creditor and if you want to go and investigate a little further and then at that point You still need to fill out additional information? kyc and AML there for verification purposes now, how would Owning and holding lb a token benefit me for credit now LBA is the native digital asset token For credence Oh creds len borrow asset lb a token is designed to enable affordable and equitable access to credit now you can get the lb a token on multiple exchanges including uphold and I believe it’s now at like point, uh, It was either twelve cents or point zero one one cent. I forget exactly what it’s at right now Well, we’d have to double check Oh Look at that now my Internet’s back up so we can we can take a look Online here in a minute Now the utility for lb a token Holders and credit is currently first priority access to join the program and start so any out it looks like you’re gonna have to Potentially get LBA tokens to participate not exactly sure where can I get them as an uphold customer? You can get them there you get them on other exchanges does cred perform opak and other sanction list screening yes, all customers are subject to Scanning against the office of foreign asset control Oh fact list and other compliance records. This is to comply with AML which is anti money laundering requirements the OFAC process is initiated in real time, so they do a full background check to make sure they doing their a their there AML their kyc their You know, so you have the anti money laundering There then and we cover that up up in this spot as well So that’s that’s important that they’re doing that part Can I sign up to earn interest on more than one digital asset and they say absolutely You can pledge any of the supported digital asset types that cred earned currently offers So we’ll go down and see what they currently offer now here So for example, you sign up to earn interest on both your BTC and XRP now They only do it at the beginning of a month in the middle of the month So it starts on the 1st and the 15th if you miss that investment period they’re gonna hold it over until the 15th So if you put it on January 2nd, it’s not actually going to go in until the 15th and then it’s held from that period Forward so what? why don’t why did I get notified on a delay so there could potentially be delays if they’ve and so let’s see if the minimum loan amount is not reached by the anticipated start date those who signed up for the Participation would be notified of a delay and a new start date would be set So basically you’re loaning your money and I believe it’s gonna be it’s almost like a peer-to-peer There in between other people are borrowing and and so even though it’s not real I appear to appear It’s not like a prosper but you know this this is what their collateral collateralizing someone’s digital assets to then loan them money and and you know So there’s a lot a lot that they’re doing in the process of someone who’s taken out their loan and they’re then taking digital asset To loan, but they’re not, you know reaching the the minimum number, you know I mean you guys can go in and read it in. You know it more in more depth I don’t think I have to really get into it at length, but It could be it could be a little it can seem a little confusing on its face but it really isn’t again if the minimum this is what they’re talking about loaning out so I don’t want to walk really Dissect that any further now, when do I know the exact interest payment amount for the program ISIL? When do I know the exact inch? Okay That whatever they saw the strike price is determined on the start date So their interest rates can change and they’re gonna let you know what the interest rate is when this the loan initiates So on the strike on the start date not strike. Yes the strike price on the start date the current market value of the Jew acid is recorded and analyzed Interest rate is applied to calculate the total interest you receive now the interest they’re paying out is based on Current value, even though really if you look at it, it shouldn’t really matter what the current US dollar value is if they’re paying you an interest based off of your Your individual asset. So if they’re gonna pay you if you have a thousand XRP and they’re paying you Whatever percentage will annualize then that’s the percentage that they should pay you based off of the total amount held but they are somehow tying this to the current value and then Determining they’re tying and the interest rate based on the value of the digital asset at the time It was recorded back to the USD value Now, what is the creditor and schedule for interest payments now? This is where it gets a little sticky Because the yield is six is set for six months maturity. It’s kind of like a bond It’s like a six-month bond Now you put your money you put your digital acid in it’s 100% tied up for the term for that six months So you have to again make a determination? As to whether or not you’re okay tying up your digital asset for the term of those six months where you have no Access to it now they are going to start paying off interest And I believe that when it and somewhere down below when they actually start maybe it’s here. I’m hang on Oh, yeah. So each yield program is set for six months interest payments are made quarterly So at maturity date the principal is returned to the customer along with the interest payment So paid out quarterly but being held for essentially two full quarters So you’re going to get paid twice on it once midway through and the second, you know when they release the funds So that that’s the that’s the tie up now if we go in a little bit further What happens if the value Mya of the value of my asset changes during the duration of the credit program? Now this is irrespective of market conditions you will still receive USD or stable coin equivalent interest payments based on the price of the crypto at the start date and That’s it. So now What are the digital asset types they currently accept BTC XRP eth? US dollar euro gold and With plans for additional assets in the future. So right now digital asset wise there’s three This is a significant milestone as well Being that they’re putting really only the top three digital assets normally We see like on coinbase. They’re playing around with other digital assets They’re not putting XRP in the mix. Although a lot of exchanges globally are beginning to add XRP We see a lot going on with finance I think it’s significant that cred and uphold are tying up to loan to To provide interest on Bitcoin XRP aetherium as the three primary digital assets You’re they’re allowing you to invest US dollar and euro Gold. So this is interesting. I think it’s a really interesting dynamic now When we get into The interest rates and then we’re going to need to go down a little bit further It’s going to talk about whether it’s secured now that here’s another big plus so you really have to decide How risk adverse you are to? Really participating in a program like this Again on its face. A lot of the concept of it is very sound it’s a really a nice program It’s the beginning of a trend that we’re gonna really see a lot within the banking industry Shift to we’re gonna see a lot of changes we see a lot of blurring of the lines between digital asset exchanges Ben banks and traditional banking and Uphold is taking one of the biggest steps forward and one of the first big steps for it Although we see others that are initiating as well But now when we look at the interest interest, this is really significant because this is an annual percentage yield But still when we look at it in terms of if you have your your digital assets Tied up right now on an exchange or sitting in exchange or sitting on a ledger you’re getting zero interest on it Now what they’re talking about is paying out a ten percent annualized percentage Yield on Bitcoin a five percent on x RP 3 percent on etherium three percent on US dollar a three percent on euro and two percent on gold right now if you put your money your Fiat currency in a savings account. You’re lucky to get one or one and a half percent here They’re offering three percent right off right off the bat aetherium three percent XRP again if you’re not risk adverse to tying up your Digital asset right now for six months with no access to it you’re gonna it gives you an opportunity to earn five percent on your x RP and 10% on your BTC those are significant percentage returns. However, and I think this is a big however, and I do need to indicate at this point I’m not providing any form of financial advice as you know, I’ve set up multiple times. I’m not a financial adviser I’m merely going through and showing you the pros and cons of something that uphold and cred have partnered on to provide and make in really providing my opinions on what I see as the trend moving into the future and if you decide to do this Really you’re doing it based on your own research and your own decision now When and how do I receive the interest rate interest payments start and accrue? this start date after cred successfully debits from your designated uphold wallet the interest payments are made every Three months we talked about it once a quarter now Let’s go down here because this is really where the risk your risk tolerance comes into play is credit or an fdic-insured Cred is not a bank and the cred earn product is not FDI FDIC insured this to me is a big deal because You know right now that you’re taking a risk Holding your digital assets on specific exchanges if not all exchanges you’re better off controlling Direct access to your digital assets many talk about it. You have the ledger and an OS solution you have other solutions out there The key is that you have Control over your digital asset. Now. What is the likelihood of a coin base or a buy Nance getting hacked? what is the Potential of an up hold getting hacked and you losing your digital asset. I don’t know, you know, we saw what happened with quadriga CX in Canada, maybe that was a fluke. They were mismanaging funds The the CEO dies he takes his the only key with him everybody loses their funds we’ve seen other exchanges hacked so You’re basically at this point taking control. Now again is Gemini going to be hacked is uphold coinbase? Bitstamp or any of these major exchanges that exist today of putting themselves in a position where there’s a potential For them to be hacked. I guess anything is possible It’s probably on the outskirts of with a possibility. However, and really again, we have to always come back to this you’re better off controlling your own destiny at this point now if you’re if you’re determined to invest Threw up hold into cred you’re taking a hundred percent risk That everything is going to go. Ok. Now, is there a chance it there’s always that off chance Most likely it’s going to be safe and secure. But who knows and that’s the big question the fact that it’s not FDIC insured is it worth the five percent or the ten percent? annualized return on your digital asset or the three percent on aetherium or the three percent on a fiat currency is that Marginal amount that you would make and you have to make that determination for yourself. Is that risk? Valid for the amount of return that you’re gonna get after six months of completely tying up those funds So again, if you put a US dollar a euro You’re tying that up for six months. Just like you’d put it into a bond, but most bonds are insured and backed by FDIC now again, in this case, you’re not getting any type of FDIC insurance coverage, so Let’s leave it at that now who should consider? Cretin the program is great for everyone who wants to earn a return on your assets over time This is their statement. Who should it be now again? yes in concept everybody anyone who wants to appear a Digital asset is sitting stagnant and you don’t anticipate a huge bull market. You don’t anticipate Selling even if there was a huge bull market tomorrow You really have to make that determination for yourself. I will fall back on this fact that it’s not FDIC FDIC insured that’s me. That’s that’s really again. I’m just pointing that out here So if you have any questions further information you can you can find this online I’ll put a link to this and you know again, it’s your risk tolerance That the world is changing right now, you know, it’s it’s very very interesting, you know, overall, you know, we talk again, you know We started off the morning talking about uphold we started off talking about Babb and backs and I’m gonna do another video on that as well as I dig a little further into understanding what it’s all about the lines of of Traditional banking and digital exchanges are blending and we’re gonna see more and more of that happening I believe over the next year two years and really the whole the way the way we transact in in our currency and even we might get to a point where we’re putting our our paychecks directly into An up hold So hey You know, if you enjoyed today’s video I might have gone on a little bit longer than I wanted to hana on this one Topic, but I thought it was important to cover it more in depth, but if you liked today’s video Please remember to give a thumbs up leave some comments below and if you haven’t done so already Subscribed to the channel and just a quick note every Saturday morning 8 a.m livestream morning crypto with the huddle report again I look forward to seeing you on the next video and until that time keep on huddling your crypto

22 thoughts on “LEND Your XRP to Uphold and EARN? Good or Bad idea?”

  1. You have to be kidding me !!!!
    This is a terrible idea and anyone that does it,,, just wait til you try and get your crypto back !!!!

  2. The two that really interest me is Borrow and Debit cards. I think this is going to be a big future, especially if you can access this facility internationally outside your country. Borrowing against your crypto means you can access the cash without triggering a capital gains event. Debit cards from an institution outside of your country means you can spend your crypto without having to convert it to fiat and pay capital gains tax on it.

  3. Potentially you could deposit 10,000 XRP, borrow half the value and buy another 5000 XRP. Your interest should cancel each other out and hopefully after six months XRP price has gone up significantly so you can sell some of the 5000XRP you bought and settle the loan, keeping the rest. Risky but interesting.

  4. Good info! I prefer celcius network to gain interest with as they don't require such restrictive rulings… No mandatory holding period… You get paid every Monday!

  5. Great review. Thank you for taking time to thoroughly explaining pros and cons.
    I do believe that more Financial tools like Cred and Nexo will become commonplace in coming years. Cred and Nexo are just the first wave. I’m not surprised by the high interest rates paid to holders of XRP, who loan digital assets to institutions. As demand increases exponentially for XRP Bc of its use for cross border settlements, institutions will need to obtain as much XRP as possible.

    Miguel Vias has stated in a few videos about how derivatives and using XRP as collateral in loans will play an important role in providing additional liquidity for XRP. Ripple will be loaning XRP to institutions and/or to banks subsidiaries. Or liquidity providers and market makers.

    I’m a fan of Nexo. They’re supported by institutional custodian, BitGo and promoted by Arrington Capital.

    Can you discuss Nexo on your next video??? Their instant loan platform is extremely flexible for XRP holders to take advantage of. Either to access profits without paying taxes. No monthly terms on Loan. Interest is automatically deducted. 40% LV ratio for a loan using XRP as collateral is not bad at all. It is possible to take out a loan and buy up more XRP with that money.

    Yes, it’s risky to use all your holdings to buy more XRP. $2,500 of XRP is the Minimal amount needed to obtain a $1,000 loan thru Nexo. That $1,000 could theoretically scoop up another ~3,000 XRP at current prices. This would definitely be risky at the top of a bull run but at these prices it’s less of a risk. Nonetheless it’s still a risk but Nexo auto deducts monthly interest. They will only liquidate your position if the value of your holdings drops below $1,250. That means if your $2,500 of initial holdings would have had to drop 50% to be liquidated.

    But I’m more interested in your opinion and thoughts on using a Nexo loan to take profits out, specifically into fiat, after a price spike or bull run, to then spend in real world????
    Wouldn’t this avoid being liable to pay any capital gains taxes and not having to selling any of your XRP holdings????

  6. Here’s another company offering loans using your XRP as collateral. “HODL Finance” Are you familiar??https://medium.com/hodl-finance/introducing-ripple-backed-loans-7aeeaee116ff

  7. This is designed to f*ck you out of your crypto investments with an unforeseen 'market event'.
    The inevitable 'disenfranchised investor' lawsuit and eventual settlement will be vastly less expensive than what Uphold will gain in the long run.

    Don't do it.

    When they start offering to hold your crypto, you KNOW it's getting ready to explode!

  8. I think this is just another way of companies getting their hands on your XRP for free. I would recommend against lending your XRP out if you are smart. Put it on your Nano and forget about it.

  9. Uphold – scammers! You will give them your passport information, but you will be refused verification without any reason! It is impossible to withdraw money! Perhaps the Brave browser is a scam, since they have been cooperating with scammers so far! Do not waste your time and nerves in vain! Payments from there are no more!

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