Crypto loans have been investors' favorites more than any other product in the cryptocurrency market. One of the exchanges to enter the loan space quite early was the Genesis Global trade, which was founded in 2018, just when the Bitcoin run ended.
The loan space exploded with multiple exchanges that offer loan / loan services to clients. Recently, Ripple in its fourth quarter report noted that the XRP loan / loan market experienced substantial momentum and was now considered a $ 5 billion industry.
However, with this exponential increase, the need for exchange connectivity functionality in addition to a treasury management function has become extremely important, according to Michael Moro, Executive Director of Genisis Global Trading. Moro, in an interview on the Castle Island podcast "On the Brink," explained that despite having large-volume clients with large cash reserves, there were many companies whose needs went beyond what exchanges were willing to offer. .
«… from the perspective of treasury management, it is really difficult to have a good management of your cash position, your Bitcoin, any encryption position that you can have in 30 different exchanges around the world so that you can capture any arbitration or type trade efficiently. »
Moro mentioned that the need to add a treasury management function would allow a user to instantly rebalance exchanges.
Despite the risks involved, the return on investment (ROI) in the loan sector took the lead during the last 90 days and last year.
Although the loan sector houses only 8 tokens, five tokens were responsible for the sector's positive average ROI for 90 days and last year. The tokens of the loan sector showed an average ROI of more than 75% over the past year and 15% in the last 90 days, according to a report.
Moro, during his interview, said that crypto space was still in its initial stage and claimed that there were not many solvent counterparts in crypto space.
Moro concluded by saying:
“… The things that will keep us awake at night are people who are shorted because hey, they caught you in a little squeeze and you don't have enough cash to buy it again. There will be situations in which credit is one thing you can measure. What is more difficult is operational safety. "