• Home
  • Bitsoft 360 Erfahrungen
  • Contact
  • Slots Not On Gamstop
  • Non-gamstop Casinos
  • Best Non Gamstop Casinos

Peer & Social Lending

Everything Peer to Peer Lending

  • Blog
  • Borrowers
    • Lending Club
    • Lending Club Small Business Loans
    • Prosper
    • SoFi
    • Upstart Loans
  • Investors
  • New Here?
  • Resources
  • Videos

Peer to Peer Investment | My Experiences

May 11, 2016 by John Carson Leave a Comment

The world of Marketplace lending seems to have fallen into complete disarray in recent times. Prosper had to lay off 28% of its workforce earlier this month, Lending Club’s CEO resigned, and OnDeck’s performance left many analysts disappointed.

It’s fair to say, that May has been a month to forget for US’ peer-to-peer lending platforms. Across the pond however, European platforms are providing a huge amount of fun for those of us who have taken the plunge with a peer to peer investment.

Today, I want to talk about the three European platforms I have been enjoying the most: Bondora, Bitbond and Mintos. Let’s get cracking!

(ALL images are Media Files. Simply click on them to magnify :))

Bondora | The King of Eastern Europe

My peer to peer investment experience on Bondora has been joyous. Founded in 2009 by the exciting young entrepreneur Pärtal Tomberg, Bondora is quickly establishing itself as a major player in the European Market. The platform boasts a net annualized return on investment of 17.56%, and over €63 million in loan originations. Although 17.56% seems a little high from where I am standing, the excellent Claus Lehmann has seen returns around the 17% mark.

So how do they do it? Well, Bondora seems to have nailed a specific niche: (mainly) Eastern Europe. Only borrowers located in Slovakia, Iceland, Finland - and the notable exception - Spain, can apply for a loan. Restricting their pool of borrowers, seems to have provided them with a great expertise on filtering out the great from the bad. (In fact, only two countries are represented in my portfolio: Estonia and Finland!)

As a result lenders located in the SEPA region can make their peer to peer investment, safe in the knowledge that they will make a return.

Initially, it seems that lenders couldn’t have it any easier on the platform. You simply add funds your Bondora account, set a desired bid size, choose your risk profile and activate your portfolio manager. As you can see from my Screenshot, I have opted for the “Balanced” approach which gives me an expected return of 14.88%. The funds will then automatically disburse into loans which fit your risk profile. Easy.

Peer to peer investment

(By my calculations, I have received slightly higher returns than that. But I will not be sending a letter of complaint ;))

What more is there to know? Although the process of placing a peer to peer investment seems straight forward on the surface, it turns out to be quite a convoluted process if you care to dig deeper. As Lehmann puts it:

“With the introduction of new regulation in Estonia, Bondora now prefunds all loans and also keeps a stake in the loans (‘skin in the game‘). Manual bidding on loans is not as straightforward as previously because now investors can make bids, which are not binding until allocation happens.”

Importantly, this only applies if you do not activate your portfolio manager.

Another important feature for peer to peer investors, is the thriving secondary market Bondora offers.

Bondora Secondy Market

Here, you can make a particularly cheap peer to peer investment. Subsequently, though the repayment rates are lower and the corresponding risk of default is higher.

Overall, Bondora is going from strength to strength and is providing a huge amount of fun to p2p lenders like me. Long may it continue.

Bitbond | The Future of P2P Lending

I first came across bitcoin peer to peer investing over Stu Lustmann’s excellent p2p lending blog. Specifically, it was his earning report for May which peeked my interest.

Fascinated, I started researching the bitcoin lending space, and decided to invest in Bitbond. By documenting my experiences along the way, I have tried to spark other traditional p2p lenders into giving it a shot.

But before we go into my experience on the platform, let’s take a step back to understand what Bitbond is really about and why I think it’s fascinating.

Founded in Berlin, 2013 by Radoslav Albrecht, the fintech startup has received ~€1 million in VC funding and has been growing at a significant pace for the last year or so. Now counting +30,000 users, the bitcoin lending platform specialises in providing small business loans to borrowers around the world. The international aspect of Bitbond is exciting, and is the reason why bitcoin is used.

By cutting the banks out of the process, lenders can place a peer to peer investment and borrowers can take out a loan regardless of location. The thought of supporting small business owners globally seemed pretty cool to me, so I started investing.

As I suspected, the more personal experience Bitbond offers has proven itself to be massively enjoyable. Currently, I am supporting an eBay powerseller from Portugal,  an Indonesian Taxi Driver, and an Entrepreneur located in the Philippines.

On the flipside, the risk investors take on is substantially higher than on the other platforms mentioned here. Borrowers are often still becoming acquainted with bitcoin technology, which can also delay repayments by a couple of days.

Fundamentally though, my portfolio is looking pretty good.

Bitbond Portfolio p2p investments

Another important point, is Bitbond’s transparency. All investors are listed on the loan pages (with pseudonyms), and can communicate with the borrowers directly via the comments sections!

Peer to peer investments

Overall, the investing process on Bitbond is more personal but less efficient than on Bondora.

You can however activate the AutoInvest feature, to automate your peer to peer investments, but I have chosen against this to maintain the human aspect of the platform.

Finally, you might be saying: “I don’t have bitcoin and don’t know how to get some, so peer to peer bitcoin lending isn’t for me.” Well, you’re entitled to your opinion, but buying bitcoin on Bitbond is as easy as transferring funds on Bondora. As long as you are in the SEPA region, you will be able to buy bitcoins directly on Bitbond.

For those of you located outside of the EU, use Circle or Coinbase to get your bitcoins at zero exchange costs.

I think bitcoin peer to peer investments will be massive in the future!

Mintos | The Rising Star of European P2P Lending

Significantly younger than both Bondora and Bitbond, Mintos, the Latvian p2p loan marketplace, was founded in 2015. Intriguingly, Mintos harbours some significant differences to other peer to peer investment platforms, because it brings together investors and loan originators! These include Mogo, Capitalia and Debifo among others. From an investors perspective, this makes the process a tad more anonymous but that’s not a KO-criteria for me.

Mintos is probably the least well known platform of all three discussed here. It’s relative obscurity belies its massive size however, with over 4000 loans listed in the primary market and a staggering +11,000 in the Secondary Market. With so many options, what can lenders expect from their peer to peer investment here?

Mintos peer to peer investment

(There are only five listed here because of the filters I have set)

Like Bondora, Mintos specialises in bringing European investors together with Eastern European borrowers. Below you can see their loan originations by country to get a better feel for the platform.

Mintos loan performance details

As per the industry standard, the interest rates for borrowers, depend on the quality as well as the purpose of their application. As you can see from the Screenshot below, in May of this year, “Invoice Financing” at 12.48% and a “Mortgage Loan” at 14.44% represent the low and high end of the spectrum in terms of interest rates.Interest Rates on Mintos

What sets Mintos apart, is the very high level of security offered to Investors. Indeed, most loans on the plattform are either secured - ie. the borrower provides collateral -  or come with a buyback option if the borrower is +60 days late on his payments.

As a consequence, the interest rates are lower than on the other platforms, and so is the potential payout to investors. Surprisingly Mintos does not (to the best of my knowledge) provide statistics with regards to the average ROI, but my personal experience has been ~9% pa.

Like this investor however, I think that Mintos could do with increasing the number of short term business loans available on the platform.

Overall though, Mintos is an excellent platform which I will continue to enjoy for some time to come!

Peer to Peer Investment | My Experience

With that under out belt, I hope I could shed some light on a few of the lesser known peer to peer investment platforms in Europe. As a takeaway, I would consider the following categorisation appropriate:

Bondora -> Small/Medium Risk -> Attractive ROI

Bitbond -> Medium/High Risk -> Very Attractive ROI and enjoyable personal touch

Mintos -> None/Small Risk -> Less Attractive ROI (but still ~10%)

Happy hunting 😉

Filed Under: Bitbond, bitcoin investments, Bondora, Mintos, peer to peer investing Tagged With: Bitbond, Bondora, Experience, Mintos, p2p lending, Peer to peer investment

Investing in My First P2P Bitcoin Loan On Bitbond Pt3

November 2, 2015 by John Carson Leave a Comment

Welcome to part three of my p2p bitcoin lending adventure. In this part I will update you on some of my previous investments as well as clue you in on how I spent this month’s €100.

Before we have a detailed look at my portfolio let’s re-cap on the investment strategy I am following. This should allow you to understand the motivation behind my investments more clearly, and might give you some ideas for your own investment strategy.

Important factors I consider:

  1. Connected and credible eBay account
  2. Small business loans
  3. Clean repayment history
  4. Diversification across currencies, loan terms, regions of the world, and loan amounts
  5. Medium-to-high credit risk investment portfolio. Meaning B to E ratings.
  6. Informative loan description
  7. I do not invest in businesses I don’t understand

For a more detailed approach, please check out part 2.

I should add, that some of my investments might only fit a majority of these criteria and not all.

Now that the standards I set are clear, here is the list of loans I invested in this month:

Loan ListingsInvestment (BTC/USD)
https://www.bitbond.com/listings/2MPGMW4T7M0.1/33
https://www.bitbond.com/listings/2M045T4SBQ0.02/6.60
https://www.bitbond.com/listings/2MDBH04SWD0.02/6.60
https://www.bitbond.com/listings/2MRYED4TBT0.02/6.60
https://www.bitbond.com/listings/2MSAT74TCX0.05/16.60
https://www.bitbond.com/listings/2MRN204TB20.05/16.60
Total =0.26/86.30

As you can see I have fallen a little short of the €100 this month. This is mainly because two loans I lent to were not fully funded, and my investments were returned back to me. I will keep looking for suitable alternative loan listings in the coming days to spend my remaining bitcoins.

My Portfolio So Far: Investing In My 10th Bitcoin Loan

With that under our belt, let’s have a look at my portfolio summary as of 2nd of November. (Click the image for a better view)

As you can see I have invested in 10 loans so far with an expected internal rate of return of 17.66% and 13.05% for my bitcoin and dollar denominated loans respectively. I am not sure what my actual IRR will be but I’m intrigued to see what it turns out as, especially after one or two almost inevitable defaults.

To shield myself from the potentially catastrophic effects of defaults, I have diversified as much as possible within my given parameters. Below you can see a screenshot of my investments, showing you my diversification (Click the image for a better view):

For my next round of investments, I will keep in mind to favour dollar denominated loans, as my portfolio is a little bitcoin heavy at the moment.

From the screenshot given above, you will also be able to see that a number of my loans have not been funded yet. This is because, as with most p2p lending platforms I am aware of, loan requests on Bitbond are active for a predetermined period, giving investors time to acknowledge and invest in them. In Bitbond’s case, the period is 14 days.

Due to the differing funding dates, the repayment schedule is a little difficult to follow. Below I have included a screenshot of the repayments history for my first funded loan. (Click the image for a better view)

Under the Outstanding Principal  column you can see the value of the loan that was funded. In this case, the loan was 5 bitcoin (btc). At today’s prices, this converts to around $1670.

The Total Payment column indicates my investment in the loan. In this case it was 0.15 btc which was around €35 or $38 at the time of investment. Adding the Interest Payment to the Principal Payment gives us my total repayment which is 0.16 btc. By today’s prices, this would convert to €48 or $53 giving me 37% return on investment.

This highlights the great opportunities and risk associated with bitcoin investments. The earnings can potentially be huge, but the borrowers ability to repay may be compromised.

That being said, the risks of bitcoin denominated loans are clear from the outset and I trust borrowers to inform themselves prior to taking out a sizeable amount of money.

I am looking forward to seeing how my bitcoin denominated loans play out.

I will update again next month with a summary of my new investments. Please let me know in the comments below what you think of this series, and ask me any questions I might have failed to answer so far.

 

Filed Under: bitcoin investments, Investing, p2p Lending Tagged With: Bitbond, Bitcoin Investments, p2p lending

Investing In My First P2P Bitcoin Loan On Bitbond (Pt2)

October 12, 2015 by John Carson 4 Comments

Please note that this is not investment advice.

So, as announced last month, I will be trying out the peer to peer lending platform Bitbond and will be writing about my experiences on this blog. The positives, the negatives and the room for improvement will all be discussed here.

Initially I will only invest €100 (฿0.454 as of October 12th 2015) in handpicked p2p bitcoin loans, following up with another €100 every month. This will allow me to build up a respectably diversified portfolio, but still gives me the time I need to learn from my mistakes. I will tell you my investment strategy later on so you can follow developments and hopefully learn from the mistakes I make, as well as pitch in with your own investment strategy in the comments. All the great interest rates and dreadful defaults will be recorded on this blog.

Buying Bitcoin For My First P2P Bitcoin Loan

So let’s get started. Before we can invest, we need to get our hands on some of the digital currency. The ease of doing this depends on your location, although it is relatively simple to do anywhere in the world. I am currently based in Europe and luckily they (Bitbond) just rolled out their newest feature; allowing users with EU bank accounts to buy bitcoin on Bitbond itself, without the need to register with an exchange.

I’ve included screenshots of my progress all along this post, so you can get a feel for Bitbond and see if p2p bitcoin investments might interest you. Below is the welcome page of the Bit4Coin integration which allows you to buy bitcoin on Bitbond if you are in Europe (including the UK).

Bit4Coins Bitcoin Exchange With Bitbond

The process is pretty self-explanatory, I just had to type in the usual basic information about my personal and bank information. It’s worth touching on the second step, which is the identity verification part, as it actually doesn’t involve the uploading of any scanned documentation or such like.

Instead it is a live video session with an english speaking security assistant who asked me to hold up my ID and input a tan number he sent to my phone. Interesting stuff.

If you are not located in Europe (and I know a lot of you are in the US, Australia, New Zealand etc), you will need to find an exchange or marketplace that services your region.

Below, I briefly outline the best way for you to get bitcoin quickly. I am by no means an expert here, but Bitbond have a guide, which helped me get an overview for the non-european readers.   

For most of you, Coinbase seems like the best option for acquiring your first bitcoin. I signed in and purchased some, in order to go through the experience, and can highly recommend them. The signup process is pretty simple, and the navigation afterwards is easy. If you have difficulties with signing up, check out the support documentation for detailed help.

If Coinbase is not an option for you, have a look at Local Bitcoins. They service most areas in the world and tend to offer decent pricing from what I have read. I have not used the platform personally however, so let me know what you think in the comments below.

Once you have bitcoins on your Coinbase or Local Bitcoins wallet, simply transfer them to your Bitbond account by scanning in your QR code, or entering your Bitbond wallet address in manually.

Adding Funds To Your Bitbond Wallet

Right, now that the basic stuff is out of the way, let’s get investing.

What is my investment strategy on Bitbond?

So first off, I think it’s really important to have an investment strategy. Blindly following my gut feeling has never worked for me, both on p2p lending platforms and in real life. Setting clear investment parameters obviously depends on the information available to you.

In Bitbond’s case, the amount of data is quite impressive. Going to their statistics page, we can download a CSV file containing their entire p2p bitcoin loan history. Importing this into Google Sheets, we can manipulate the Data and see which investment strategy would have worked best in the past, giving us insights into what will work in the future.

Below you can see a screenshot of the CSV file. (I have made it a Media File, so you can click on it and see it in its original size, in case it’s too small for you at present)

P2P Loan History on Bitbond

Some columns have been cut out for size and visibility reasons but here is a list of all the factors included in the CSV which will be available to us:

  1. Loan Identifier
  2. Nominal Interest
  3. Term
  4. Purpose
  5. Project Description
  6. Borrower Identifier
  7. Borrower Rating
  8. Employment
  9. Region
  10. Facebook
  11. Twitter
  12. PayPal
  13. eBay
  14. LinkedIn
  15. Publishing Date
  16. Funding Date
  17. Status
  18. Amount Requested
  19. Amount Funded

Despite the long list there is some important information missing in my opinion, such as the name, an image and a relevant email address, so I can contact the borrower before commiting any bitcoins. I understand that giving out email addresses can be a thorny matter so I don’t hold that against them. However, the name in particular, is usually an important factor in my p2p investments because I like to be able to do some background checks of my own on prospective investments. This would usually include, checking Facebook Groups for scam alerts related to this name, doing a google search and seeing what comes up, as well as checking them out on LinkedIn, to see their professional credentials for myself.

Further, an image helps me, because over the years I have become better than most in identifying stock or stolen photos. Overly attractive people smiling into the camera, or low baseball caps and sunglasses tend to be reliable red flags in my opinion.

Using Data to Devise An Investment Strategy On Bitbond

Nevertheless, with this Data we can start to sculpt our ideal portfolio from scratch. In order to do so, we need to write out our motivations behind investing in the first place. For me, I would like to make high returns while investing in small business owners from around the world. Thus, I will be looking for borrowers who have connected their eBay account, and have indicated “Working Capital” as the purpose of their p2p bitcoin loan.

Borrowers with a Credit Rating ranging from B to E will be considered in order to insure high yields, despite the probably higher default rate. The loan and payment history also play important roles in my strategy, as borrowers with overdue loans are regarded as untrustworthy and will be ignored.

Other factors I will be scrutinising include the Loan Description and the Industry in which the borrower is active. If I have little-to-no knowledge about the industry, or the Loan Description is sloppy or too short, I will not invest. Preferably, borrowers will already have repaid a loan on Bitbond, but I am flexible on this point.

With the cornerstones of my lending strategy in place, I will insure diversity in most other factors across my investments. The location, interest rates, the denomination of the loan, employment, size and period of the loan, the number of twitter followers or Facebook friends a prospective borrower has, should vary across my investments in order to ensure maximum possible diversity in my portfolio. This is important, because sudden macroeconomic effects for example, can radically change an entire regions repayment rate. Thus, I protect myself by diversifying as much as possible around my basic investment principles.

Now that we have our strategy in place, we can have a look at the p2p bitocin loan listings to start finding the best borrowers. The first borrower I checked out seemed a good fit already.

P2P Bitcoin Loan on Bitbond

As you can see from the screenshot, this listing falls in line very nicely with my investment principles, so I decided to place a bid of BTC0.15 or €32.72.  

Placing a P2P Bitcoin Investment On Bitbond

To place a bid, all you have to do is press the orange button and enter a value of your choice. Be sure to have bitcoin exchange rate site open so you know exactly how much money you are investing in bitcoins.

Once I had placed my first bid, I sifted through a large number of other listings until I had found three more, bringing my total to four, for now. Below I have linked to their listings pages, so you can check them out and understand what’s happening

  1.  https://www.bitbond.com/listings/2KAPFH4RGF invested = BTC0.15
  2. https://www.bitbond.com/listings/2K0SAW4R1Z invested = BTC0.15
  3. https://www.bitbond.com/listings/2KCEN64RJJ invested = BTC0.05
  4. https://www.bitbond.com/listings/2JM63P4QDZ invested = BTC0.1

I picked these borrowers because they fit my investment strategy, I like their loan descriptions, and I believe their credentials. Their credit ratings vary, the highest being a B, and the lowest a D, as do their locations and social media connections. This is perfect for my goal of diversifying as much as possible, and hopefully reaping handsome rewards for it in the process.   

Finally, having a look at my “Investments” section, I can see my activity laid out in visual form, which is pretty sweet.

P2P Bitcoin Investment Overview at Bitbond

P2P Bitcoin Lending With Bitbond

Below the graphs, the repayment schedule is located which provides all the essential information in one go.

P2P Bitcoin Lending Schedule on Bitbond

What happens to my p2p bitcoin investments?

Now that my first p2p bitcoin loan has been made we have to wait and see if the borrowers I lent to get enough funding to get paid out. This requires a minimum 60% of the request to be funded on the date of expiration. Every loan request is available for investment on Bitbond for 14 days, with mine having between 2 and 12 days remaining on their loan requests at time of writing (12/10/2015).

That being said, should one of my investments not get the funding they need to receive the loan, the money I lent will be returned to me and I will reinvest it on the platform. This will be accompanied with a post on this blog of course to keep you up to date.

That’s it for today. Let me know what you think of this series and Bitbond in the comments below. Any tips are hugely appreciated.

 

Filed Under: Investing, p2p Lending, Portfolio Tagged With: Bitbond, Bitcoin Investments, Bitcoin Loan, P2P Bitcoin Lending

Start earning passive income!

Follow Peer & Social Lending

  • Facebook
  • Google+
  • Instagram
  • RSS
  • Twitter
  • YouTube

Recent Posts

  • Best European Peer to Peer Lending Platforms | P2P Investing
  • Peer to Peer Lending Sites → 24 of the World’s Best
  • P2P lending in 2017 » What does the future hold?
  • Conquering the future with passive investing
  • Viventor review | Make smart passive income

Like Peer & Social Lending?

© Copyright 2015 by Peer & Social Lending · All Rights Reserved - Disclaimer - Privacy Policy - Bitcoin lending