Bitbond, German’s Bank Uses Bitcoin to Transfer Online International Loans
A German online bank is offering a loan service with a difference, international loans that are transferred using bitcoin.
Bitbond, an online bank founded in Germany in 2013 by German Radoslav Albrecht, has found an innovative use case for the borderless nature of Bitcoin, international loan payments. Albrecht says that Bitbond’s use of cryptocurrency will allow it to transfer money quicker and at a lower cost than standard banks.
It was the first to use bitcoin to transfer credit in currency internationally, not only as loan collateral, and it’s currently processing about $1 million in loan payments per month.
“Traditional money transfers are relatively costly due to currency exchange fees, and can take up to a few days,” Albrecht told Reuters TV in his office in Berlin’s fashionable neighborhood Prenzlauer Berg. “With Bitbond, payments work independently of where customers are. Via internet it is very, very quick and the fees are low.”
Clients hold the loans in digital tokens like Bitcoin only for seconds or minutes until they are exchanged back into the currency of the country where they wish to receive the funds, avoiding the crypto currencies fluctuating exchange rates.
Adoption of Bitcoin has been rapid in Germany. It trails only the US, according to Bitnodes, which tracks the location of all the Bitcoin nodes that transmit data about new transactions. Loans are relatively small and usually don’t exceed 50,000 dollars. Because most clients are small business owners.
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