As the world begins to slowly open up again, you might be thinking about all the places and countries you could visit.
If you’ve been sitting on a pile of cryptocurrencies and are wondering what to do with them, here’s a suggestion for you – why not go traveling with your cryptocurrencies? You’ve HODL-ed and traded through some of the wildest highs and lows. It’s only fitting that you treat yourself to a well-deserved trip.
While there are a few travel agents and airlines that directly accept crypto, the fact still remains that most major providers have yet to adopt these digital assets as a mode of payment. However, there is a way around this – you can obtain a fiat loan against your crypto assets. As you wait for your digital assets to continue appreciating in value, consider using this method in the meantime to see the rest of the world.
What is a Crypto-Backed Loan?
The concept behind a crypto-backed loan is simple – it involves you using a crypto asset that you own as collateral to secure a fiat loan. After that, you’re free to use the fiat you have borrowed in any way you want. All you have to do is repay the fiat that you owe once the loan term is up. In this case, you can borrow against your crypto to secure some funds that will help you get the vacation you need.
In this article, we’ll take you through the entire process step-by-step.
Step 1: Borrow Against Your Crypto on a Loan Platform
While there are plenty of loan platforms out there, we’ll be using Nebeus as an example. It is simple, intuitive, and easy to use – perfect for beginners looking to put their crypto assets to work.
In Nebeus’s case, the first step would be to create an account through their desktop or app. Once you’re done, you can start depositing your crypto and customizing your loan terms.
Nebeus currently offers two loan options. You can choose between their Quick Loans and Flexible Loans. The former provides you with a 50% LTV at a 0% interest rate for the first three months. On the other hand, if you have a clearer picture of what you want, you can simply opt for a Flexible Loan. These loans allow you to choose your desired LTV, anywhere from 50% to 80%. The interest rate will automatically change depending on the LTV you select. Best of all, you can borrow up to 250,000 Euros and for as long as 36 months.
Step 2: Deposit Your Crypto and Withdraw Your Fiat
Once you’ve chosen your loan plan, all you need to do is deposit the required amount of crypto as collateral for the loan. Then, you can confirm your loan and instantly receive fiat in EUR, USD, GBP or even stablecoins, and receive the funds directly in your Nebeus account. After that, you’re free to withdraw your funds and send them to your bank account. Nebeus will also send you an email containing the PDF version of your loan agreement after securing your loan as a copy for your records.
Step 3: Book Your Flights and Hotels
Here’s where the fun begins! Once you’ve obtained your loan, things are pretty much straightforward from here. All you have to do is use the loan you’ve secured to purchase whatever airline tickets and hotel bookings you need before you jet off.
If you’re looking for some inspiration on where to go, simply look up what the best summer destinations are. You could even check out travel vlogs on your favorite social media channels to help you decide.
Step 4: Remember to Repay Your Loan!
Holidays are great, but we all have to return to work at a certain point in time. When you’re back, one of the most important things to remember to do is to repay your loan. Remember – your crypto assets are still locked up as collateral with the platform, and you need to get them back so you can continue making them work for you. Once your loan term is up, simply log onto the platform with the required amount of fiat to repay your loan, follow the steps, and let the platform take care of the rest.
Now that you’re familiar with the process, you can start using your crypto and getting cash without selling it. As long as you have the required amount of cryptocurrency needed to back your fiat loan, getting your crypto-backed loan really takes a minute.
As the crypto markets continue to consolidate, now is one of the best times to obtain a crypto-backed loan for your travel and other daily expenses. This way, while your assets may not be appreciating in value right now, you’ll continue holding on to them while making the most of the value that they can offer you.