Blockchain technology has been influencing and changing the entire world since its birth. The advantages of decentralization from Blockchain make up for many shortcomings of the traditional financial industry and provide a new solution in the aspect of loan assignment.
1. What is creditor’s right?
When we talk about creditor’s rights, we should first make it clear that the lender’s fund must be lent to a real borrower. When the lender lends the fund to a borrower or some borrowers according to the agreement of certain interest, tenor, etc., the lender has the legal right to require the borrower to repay the loan according to the agreement, that is, “creditor’s right”.
For example, Mr. A borrowed 300,000 Yuan from Mr.B, and both parties agreed that Mr. A would pay it off one year later to Mr. B. Thus, Mr. B has the right to require Mr. A to repay as agreed, that is, the “creditor’s right”.
2. What is the loan assignment (creditor’s right assignment)
When the lender lends the fund for a period of time and wants to recover the fund before maturity, the original lender will look for a third party and assign the loan to the third party, which is called “loan assignment”. (theoretically, it is an assignment of creditor’s right, which in this scenario is equal to the assignment of the loan itself. In the following content term “loan assignment” is used. )
In the above example, if Mr. B is in urgent need of working capital after lending to Mr. A, but it has not reached the original repayment date, Mr. B chooses to assign the loan to Ms. C to recover the 300,000 Yuan back in advance. In this case, Ms. C becomes Mr. A’s creditor, and Mr. A will need to repay 300,000 Yuan to Ms. C on the agreed repayment date. This process is a “loan assignment”.
3. Disadvantages of existing loan assignment products
There have been various wealth management products based on the principle of loan assignment, under the banner of “high-interest rate and high return”, which attract users to invest large amounts of money but the potential risks are concealed. Most platforms do not have real assets cover, meaning once users fail to repay the loan, lenders will have to bear the loss by themselves. Meanwhile, the asset custody service provided by most platforms also has huge risks due to objective technical constraints and other reasons.
4. Matrixport has launched the wealth management product based on loan assignment — Matrixport Wealth.
In order to solve the existing problems in the current loan assignment products and provide users with better wealth management products and services, Matrixport has launched a digital asset wealth management product with real assets collateralization — Matrixport Wealth. （https://www.matrixport.com/loan/invest）
5. Advantages of Matrixport Wealth
First of all, Matrixport Wealth has over-collateralized real assets to guarantee the loan you purchased. When the cryptocurrency price falls, a complete risk control system will call margin/closeout in time to ensure your capital safety and eliminate the risk of capital loss caused by price slump or user’s inability to repay the loan. Meanwhile, Matrixport allows you for the early recovery of your principal and interest by assigning the loan to a third party. On the one hand, you will be able to realize the quick capital return and improve the capital liquidity, on the other hand, you can set your own price for the assigned loan to obtain higher yielding. Finally, the professional team of Matrixport from banks, financial institutions and top internet companies and the institutional-grade security custody solution will guarantee your asset security comprehensively.
6. Matrixport Wealth Welcome Event
Matrixport Wealth has launched its USDT and USDC based product, bringing you double surprises:
1）Interest rate increase. Users can purchase 1-month tenor products with 7% APY and 3-months tenor products with 8% APY.
2） VIP users enjoy the privilege of a 1% extra interest rate increase and unlimited investment amount.
If you have any questions, please join: https://t.me/matrixport
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