The San Francisco-based lender God’s study issued about 30,000 non-back short-term cryptocurrencies since December and verified borrowers using Openai CEO Sam Altman’s Iris-Scanning Platform World ID.
Divine offers loans under $1,000 on USDC (USDC) Stablecoin, primarily to overseas borrowers who are not serviced by traditional finances. Use a World ID to prevent users from opening multiple accounts after default.
“We lend to average people, such as high school teachers, fruit vendors and more. Essentially, anyone with internet access can access our funds,” he told the Finance Times. “This is steroid microfinance.”
Interest rates range from 20% to 30%, with the default rate for the first reported loans being around 40%. “High interest rates compensate for these losses,” Estevez said, adding that free world tokens issued to borrowers could be “partially” recovered.
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Daily investors can make money by funding high-risk crypto loans
Estevez said that the god lender is a daily individual seeking a solid return. “Everyone can provide liquidity. After explaining the default rate and the (interest rate) rate offered, we designed the system so that providers are always profitable.”
God is part of a growing group of risky crypto lenders who will take advantage of new market momentum and political tailwinds, including support from former US President Donald Trump.
Another startup, 3Jane, has recently raised $5.2 million from the paradigm and offers a dequalified credit line at Ethereum. Unlike God, 3Jane requires “verified evidence” of assets or income, but still does not require collateral.
3Jane will automatically introduce AI agents that follow lending rules, aiming to lower rates while repayments. Default loans on the platform are sold to US debt collectors.
Other players like Wildcat are able to accommodate market makers and trading companies and offer inadequate loans on customizable terms. According to Wildcat’s advisor Evgeny Gaevoy, “If defaults occur, lenders will coordinate directly between themselves and ask for their requests.”
Related: Fintech companies will move to lending within 3 years
Cryptocurrency gains traction
The loan remains a small slice of the crypto market, but it has attracted attention as institutional players re-enter the space. Last week, it was reported that JPMorgan Chase was considering crypto-assisted loans and plans to lend directly to crypto assets such as Bitcoin (BTC) and Ether (ETH).
But the shadow of 2022 is looming large when major code lenders like Celsius and Genesis collapse. Celsius CEO Alex Mashinsky was sentenced to 12 years in prison for fraud, and Genesis settled a $2 billion lawsuit.
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