Crypto-Secured Loans
Dealerships
Should the dealership be worried about volatility in the cryptocurrency market?
Not at all. We remove volatility risk by converting cryptocurrencies into US Dollars immediately upon transaction.
2. How long will it take to process a loan?
The Cion Digital platform makes it simple to request and process a new loan. It can take about 15-45 minutes to process a loan from start to finish.
3. How long will it take for a dealership to receive the funds from the loan?
DeFi loans funds will be deposited within a few minutes once the borrower deposits the collateral. For CeFi loans like Salt, funds will be received as quickly as the steps in the application process are completed. The origination of each loan will vary from case to case and is largely dependent on your jurisdiction and loan type (business or personal). The average time to fund a loan is between 30 minutes to 1 business day.
4. How can the dealership select the most convenient loan option available?
Dealership can help the borrower make their choice based on the following criteria:
APR - Annual Percentage Rate: The Annual Percentage Rate (APR) is the cost you pay each year to borrow money, including fees, expressed as a percentage.
LTV - Loan to Value: LTV refers to the percentage of your collateral value that you may borrow against. For e.g.: If you borrow $5,000 and deposit Bitcoin worth $10,000, your LTV ratio would be 50%. However, if the price of Bitcoin was to go down, your collateral would be worth less, which would cause your LTV ratio to go up.
Term - Duration of the loan (CeFi only) :
12 months
36 months
60 months
For a DeFi loan there is no term because it works like a line of credit, the borrowers decide when to repay the loan to get its collateral back.
5. What type of cryptocurrencies are accepted for collateral?
Currently, the following cryptocurrencies can be used as collateral:
BTC - Bitcoin
ETH - Ethereum
BCH - Bitcoin cash
LTC - Litecoin
PAXG - Paxos Gold
6. While creating the loan the user left the loan marketplace screen. Can the user go back to the screen?
Using the Cion Digital platform is very easy. At any time, members at the dealership can always press the back button and go back to the loan marketplace screen to evaluate other lenders.
7. Is the borrower restricted on where the funds come from (ie. exchange, wallet, ledger, etc.)?
There are no restrictions. All exchanges, wallets, and offline (cold) storage will work on the Cion Digital platform.
8. Can the borrower do a partial down payment with Fiat/crypto and finance the rest in cryptocurrency?
Terms will be determined by the car dealership. The Cion Digital platform enables borrowers to make partial down payments either with Fiat currency or with crypto, or fully finance the total amount.
9. Does the customer need to go through KYC(Know Your Customer) to apply for a loan?
KYC is not required for a DeFi loan. For a CeFi loan like SALT, the customer will be required to do KYC.
10. What happens if the borrower gets liquidated?
Each DeFi loan liquidates at a different LTV but typically liquidation happens around 80-85% LTV. If liquidation were to happen, the loan would default; therefore, the collateral pledged would be taken by the lender and the borrower would have no further obligations for payments. For CeFi loans like Salt, there is no liquidation LTV.
11. Where does the dealership receive the funds?
For CeFi loans the dealership will receive US Dollars in their linked bank account. For DeFi loans, the dealership will receive the funds in USDT in the wallet address that was configured in the Cion Digital platform. Click here for more information.
12. How to reach out to Cion support?
For any problems not outlined in this document, please reach out to Cion Digital through the chat feature on the website ciondigital.com or reach out to [email protected]
Borrowers
Should I be worried about volatility in the cryptocurrency market?
When a borrower has an active DeFi loan, for example with Aave, to avoid the risk of liquidation, the borrower should regularly monitor the liquidation LTV if the crypto price of the collateral the borrower supplied is dropping. The borrower will receive a notification email in case they are close to getting liquidated. In this case, the borrower should supply more collateral to avoid liquidation. For CeFi loans like Salt there is no liquidation LTV.
2. How long will it take to process a loan?
As a borrower, requesting a loan on the CIon Digital platform is really simple. It can take about 15-45 minutes to process a loan from start to finish with your sales or finance representative.
3. How long will it take for a dealership to receive the funds from the loan?
DeFi loans funds will be deposited within a few minutes once the borrower deposits the collateral.
For CeFi loans like Salt, fund loans will be received as fast as the steps in the application process are completed. The average time to fund a loan is approximately 1 business day.
4. How can the I select the best loan option available?
Borrowers can make their choice based on the following criteria:
APR - Annual Percentage Rate
LTV - Loan to Value Term - Duration of the loan (CeFi only) :
12 months
36 months
60 months
For a DeFi loan there is no term because it works like a line of credit, the borrowers decide when to repay the loan to get its collateral back.
5. What type of cryptocurrencies are accepted for collateral?
Currently, the following cryptocurrencies can be used as collateral:
BTC - Bitcoin
ETH - Ethereum
BCH - Bitcoin cash
LTC - Litecoin
PAXG - Paxos Gold
6. Am I restricted on where the funds come from (ie. exchange, wallet, ledger, etc.)?
There are no restrictions. All exchanges, wallets, and offline (cold) storage will work on the Cion Digital platform.
7. Can I make a partial down payment with Fiat/crypto and finance the rest in cryptocurrency?
The borrower can make partial down payments either with Fiat currency or with crypto, and finance the remaining amount. Terms will be determined by the car dealership.
8. Can I add more collateral to the loan if crypto prices drop?
Borrowers are able to add collateral at any time to drop their LTV. Borrowers will also receive a warning email in case they are getting close to the liquidation threshold.
9. Who pays the gas fees for sending the collateral?
The borrower will pay the gas fees for sending the transaction. Gas fees will depend on the blockchain being used and its network congestion. Typical gas fees are around $2-$10.
10. Will I be notified if there is a margin call?
Borrowers will be notified with email alerts and warnings prior to any liquidation events providing enough time to rebalance the loan.
11. What happens if I get liquidated?
Each DeFi loan liquidates at a different LTV but typically liquidation happens around 80-85% LTV. If liquidation were to happen, the loan would default; therefore, the collateral pledged would be taken by the lender and the borrower would have no further obligations for payments. For CeFi loans like Salt, there is no liquidation LTV.
12. As a borrower how can I “Deposit Collateral", "Withdraw Collateral" or "Repay Loan?
When the loan is created, Cion Digital will email a link to the borrower to manage that loan. The loan management page will have buttons such as "Deposit Collateral", "Withdraw Collateral" and "Repay Loan". It will also show all the information about that loan such as how much collateral is locked, the health factor of the loan, current LTV, and liquidation LTV.
13. Where can I see my monthly payment?
For DeFi, there is no monthly payment, it works like a line of credit, where the borrower can decide when to repay the loan at any given time. For CeFi loans you can see the monthly payment amount before submitting the loan :
14. If my crypto is staked, can they I use it as collateral?
No, borrowers cannot use staked crypto as collateral. They have to un-stake it first.
Last updated
