Warning: Do Not Lend On Poloniex

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This is a must read for bitcoin users. Poloniex allows you to lend bitcoins to others trading on margin. In theory, Poloniex will try to protect you from losses by forcing a person to liquidate if they're taking a beating.

This is not true.

I've tested lending one bitcoin over the last two weeks. That one bitcoin has gone from one bitcoin to .81 bitcoins now. That's a two week loss of 0.19 bitcoins. If I kept lending for a full year, I would have 0 remaining of the bitcoin at that rate.

Interest rates must reflect the risk associated with lending and Poloniex's users don't seem to get this. In addition, due to these losses and how quickly they've piled up, Poloniex needs to re-evaluate cutting a margin traders losses much earlier. Make no mistake: Poloniex still gets their fee, while I got the loss.

It was a good experiment, but DO NOT lend bitcoins on Poloniex. The interest rates do not reflect the risk. In order to offset losses, interest rates should be over 150{88c91daedd271a990a10650c05d769cae2765e0603edf30ca95f18704e5748e8}.

Spread this to anyone considering lending their bitcoins – they will lose in time.

Guys, the purpose of this is to warn new people who make think that lending on Poloniex is 100{88c91daedd271a990a10650c05d769cae2765e0603edf30ca95f18704e5748e8} safe. Based on my experience, it's not. Whether you agree or disagree, I think we all agree that if we have a bad experience we should caution new users on this. I don't want new people to lose bitcoins, like I did, when they think something is guaranteed, but it's not. Also, this is not FUD because this says nothing about the value of bitcoin; this is about Poloniex. Stop with the "this is a FUD post" – no it's not a FUD post because bitcoin is strong and awesome.

submitted by /u/seemqueues
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1 CRYPTO

Crypto News & ICO Reviews

1 News - 247 News - 247 Bitcoin - 1 Search

BTC - BCH - ETH - LITE - XRP

Buy Sell Trade Crypto Here

 

Ticker

1 BTC = $31852.46 USD  (via Coinbase)
1 ETH = $1329.92 USD  (via Coinbase)
1 LTC = $137.86 USD  (via Coinbase)
Quotes delayed up to 2 minutes.

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