Celsius Network reportedly doubled its interest payments in the last three months since its previous disclosure in November 2019. This represents one more signal of the constant growth of the crypto lending industry as the decentralized finance (Defi) operations attract increasing amounts of funds.
Celsius paid at least $11 million worth of Bitcoin (BTC), Ether (ETH) and many other cryptos as total interest income according to its February 20 report. That amount represents an increase of around 120% from its $5 million figure that was reported on November 12, 2019.
Today, the company is managing approximately $730 million in customer deposits and loan collateral. That represents a 62% increase compared with the last report’s $450 million figure. The cumulative value of outstanding loans has also surged by 46% since November, reaching a staggering $6.2 billion.
That figure is counted in current BTC prices, and it is influenced by its price growth. Also, the user count has increased from 50,000 to 75,000 since November.
Crypto Lending Is Growing
The nascent crypto lending industry is growing in general. It is divided into companies that offer loans in crypto, including BlockFi and Celsius. BlockFi is decentralized finance based on Ethereum.
Although all of these platforms offer virtually the same services, Defi uses smart contracts and the blockchain oracles to power its entire lending activity. Reports confirm that the amount of funds locked in Defi has surged past $1 billion.
Most of the funds are locked as collateral with MakerDAO (MKR) acting as a part of the mechanism that generates Dai (DAI), which is a decentralized US dollar stablecoin. Celsius competitors who include BlockFi have also reported strong growth showing that the lending in this industry is steeply increasing its value.
This rapid growth does not come without its disadvantages since Defi protocol bZx was recently hacked twice in a matter of two days.
The Celsius Network is constantly expanding its feature set. Recently, the firm added integration with Simplex to offer instant fiat on-ramps for all its users. It started offering compounding interest on users’ loans in January 2020.
Celsius CEO Alex Mashinsky normally shares his thoughts on the industry. In December 2019, he criticized the centralization of social media eyeing blockchain as a possible solution.