Coinloan is an Estonian crypto lending platform where investors can invest in crypto-backed loans. When investing on Coinloan, you’re not investing in cryptocurrencies but instead loans backed by cryptocurrencies. By investing on Coinloan, you can earn up to 12.3% interest per year. Learn more about the crypto interest account of this platform in our Coinloan review.
Is Coinloan safe? Find out now.
- 19/03/2021 - Coinloan is now listing GBP
- 15/03/2021 - Coinloan is now listing Stellar
Do you prefer to watch a video? Here's a short review of Coinloan:
CoinLoan in Numbers
If you’ve read our other P2P lending platform reviews, you might know that when performing our due diligence, the first thing we check out is the site’s statistics page and create a table with all the important figures.
Unfortunately, we couldn’t find either a statistics or an About Us page on CoinLoan’s website, so this review’s table is looking pretty bare...
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We reached out to CoinLoan’s customer support, which is very responsive when it comes to registering, but significantly less so when it comes to providing additional data.
That's the case with most of the crypto lending platforms.
As we always do when faced with situations like this one, we sent a set of questions to get a better idea of the key facts around CoinLoan. Unfortunately, no one came back to us.
Do you think it’s wise to invest on a crypto lending platform that isn’t able to provide a short introduction about the team? We’re suspicious...
Coinloan keeps bragging about how well their crypto lending platform is, however, the company clearly fails in being transparent.
Keep reading to find out more about our experience with CoinLoan.
CoinLoan Promo Code
Looking for a promo code or additional cashback bonus? We’re normally able to provide our readers with one. But not this time. CoinLoan isn’t offering any bonuses for new investors at the moment. If the crypto-backed P2P platform changes its terms in the future, we will update this review.
You can find all available cashback bonuses here.
In order to register and invest on CoinLoan, you need to fulfill the following criteria:
- Be over 18 years old
- Have a valid ID document
Sounds simple, right?
Not quite. The registration on CoinLoan is painful.
We had to verify three times in order to get approved. The software used to upload the above documents and the selfie didn’t work properly.
In addition to that, you need to activate the two-factor authentication (2FA).
Not that 2FA is bad, but it can take time to figure out how it works if you’re not very tech-savvy. (You can use a Google Authenticator to validate your logins into your account).
After you are verified, you can deposit funds to your account. The following currencies can be deposited: EUR, GBP, USDT, USDC, PAX. BTC, TUSD, BUSD, ETH, BCH, LTC, XMR, XRP. XLM, LINK, DAI, WBTC, PAXG.
We have tested this feature and deposited a small amount in euros. Our account got funded within one business day. It took the same time to withdraw our funds with a SEPA transfer.
CoinLoan also allows you to fund your EUR account with Mastercard or Visa. Overall, deposits and withdrawals work just as you would expect.
Deposits and withdrawals in fiat or cryptos are free of charge, deposits via VISA or MasterCard will cost you €2 + 4.2%.
Risk and Return
When investing on CoinLoan, you are funding loans that are backed by crypto-assets. This means that the borrower deposits cryptocurrencies on their account as collateral.
If you’re familiar with EstateGuru and the platform’s use of mortgage as collateral, think of CoinLoan’s equivalent as cryptocurrency.
The platform’s max. loan-to-value (LTV) is 70%. If the value of the collateral decreases and the LTV increases up to 90%, CoinLoan will sell the cryptocurrency (collateral) and pay back your money.
Borrowers will get notified (margin call) as the LTV changes due to market fluctuation of their crypto-assets, however, during a fast downturn of Bitcoin (or other crypto-assets), the sell-off of the collateral can cause significant losses on the borrower’s side.
Borrowers always have the option to repay the loan or deposit more cryptocurrency to keep the LTV at max. 70%.
Either way, you are well protected because the collateral will be sold as soon as the LTV reaches 90%.
This crypto lending platform offers (in theory) a very solid protection of your money.
When it comes to returns, CoinLoan isn’t the highest-yielding P2P platform out there. The average annual yield for your BTC assets is currently at 7.2%.
Lower yields make sense as your investment is protected by collateral, which isn’t the case with many other P2P lending sites that fund payday loans or unsecured consumer loans.
A very positive feature of CoinLoan is the fact that if the borrower repays the loan before half of the loan term, the borrower needs to pay at least 50% of the interest. That’s not the case with most other P2P lending sites.
Is CoinLoan Safe?
Now, you are aware of the basics, but is CoinLoan a legit platform?
We have already mentioned that the site’s lack of transparency is a big concern to us. But, let’s have a look at what else we found out when completing our thorough due diligence.
Who Runs the Company?
According to their LinkedIn profiles, both Alex and Max also own a company called IT Security Group.
We haven’t found more information about the CoinLoan team and the management is also not introduced on the website.
We did, however, found an article that COINLOAN OÜ has employed only three employees in Q4 2020 with an estimate average gross salary of €1,240 per month.
Who owns the platform?
The CoinLoan crypto lending platform is owned and operated by CoinLoan OÜ (former ExFinance OÜ) , and the headquarters are located in Tallinn, Estonia. The company has a European Financial License (from Estonia). Alex Falishin is the sole management board member according to the Estonian business register.
Are There Any Suspicious Terms and Conditions?
As there’s no information about the team behind CoinLoan, you should complete your due diligence by paying closer attention to information we do have access to, like the platform’s terms and conditions.
Clause 5.19: Storage of Funds
CoinLoan doesn’t say how they store and manage investors’ funds in their terms and conditions. This is a standard clause that all investors should expect to see in a platform’s terms, so it’s concerning that CoinLoan does not provide this information.
When sending money to CoinLoan, your funds are stored at a Bilderlings account. It’s worth noting that Bilderings is not a bank, but an electronic money institution. CoinLoan uses BitGo as their primary custodian. BitGo offers qualified custody and a $100M insurance on hot wallets.
Clause 13.2: Liability
Although one of CoinLoan’s product is called an ‘interest account’, your funds aren’t covered by any insurance and by investing on CoinLoan your investment is exposed to certain risks.
As CoinLoan clearly says in their Terms and Conditions, your investments aren’t insured by any jurisdiction.
In the worst-case scenario, you can lose all of your investments, but that’s the case with any P2P lending site.
Clause 12: Amendments
Possibly the most concerning clause: CoinLoan reserves the right to amend its terms anytime without prior notice.
This puts your investments at risk. If you’ve been reading our other P2P lending reviews, you know by now that this is no-go for us.
Do Investors Have Access To Individual Loan Agreements?
Investors used to have access to individual loan agreements under ‘My Loans’. This feature has been ditched by CoinLoan as the company is currently only offering the crypto interest account for which you don't have any legal documents.
Curious about what else we look at when conducting our research?
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Potential Red Flags
So far, just by having a quick browse of the terms and conditions and a look on the website, we’ve identified the following red flags:
- Terms and Conditions can be changed at any time without prior notice
- No information about the team behind the platform
- None of the essential statistics have been provided
- No publicly available audited financial reports
- Coinloan is not transparent
What’s Our Opinion of CoinLoan?
CoinLoan's crypto interest account is a suitable alternative to other investment opportunities found on other European P2P lending platforms.
Investing in secured assets is always ‘more’ secure than investing in unsecured payday loans. When investing on CoinLoan, you will need to accept the lower interest rates though.
We have previously tested the direct lending feature of CoinLoan, without much success due to the low demand for loans. It seems like CoinLoan ditched this feature and offers now only crypto or fiat interest accounts.
This further decreases the transparency as you have no idea whether there are any borrowers at all borrowing money from CoinLoan.
Risk of Ponzi Scheme
The platform offers an APY of 12.3% for depositors why borrowers can lend fiat (EUR) from 4.95% to 11.95%. Since CoinLoan isn't charging any origination fees and the APR is higher than the APY paid to depositors, we struggle to understand how the company makes money.
While the product offering seems promising, the lack of demand for loans (in the past) at interest rates which are higher than the advertised yield as well as the mentioned transparency concerns are points you should keep in mind when considering making money with CoinLoan.
Not Your Keys, Not Your Coin
When transferring your crypto to CoinLoan, you no longer own the private keys of your coins which makes you technically not the owner of your crypto anymore. Should the platform default, you will most-likely loose your entire deposit.
CoinLoan will use your assets to fund crypto loans.
Here is what you need to accept when depositing your coins on CoinLoan.
Do you appreciate this review? Invite us for a coffee ☕
We don't recommend lending your crypto on crypto lending platforms as they can decide to not repay it back based on their own terms.
As responsible investors, we recommend storing your crypto on safe hardware wallets, where you own the private keys.
We store our cryptocurrencies on 🔒, which is one of the safest (and most affordable) options to store your digital assets.
Keep your cryptos safe with Trezor.
Usability of CoinLoan
The platform’s interface looks very different to that of other P2P lending platforms.
Here’s a sneak peek into CoinLoan’s interface.
As you can tell, the menu looks very different to other P2P platforms.
In order to get started with investing on CoinLoan, you need to first deposit money.
You can choose from a variety of cryptocurrencies or fiat currencies like EUR, USD, GBP and RUB (we have only tested deposits in EUR).
You should know that CoinLoan offers the same interface for borrowers as well as investors (lenders).
You can, therefore, use all the functions for both user-types. This can be quite confusing if you’re just starting out with CoinLoan.
After you have deposited funds to your account, you will automatically earn the promised APY.
Previously, CoinLoan offered the "Lending market" feature which the platform ditched in early 2021.
CoinLoan's interest account is the only product, that the platform is offering.
CoinLoan’s Interest Account
CoinLoan’s interest account is comparable to Bondora’s Go and Grow or Mintos’ Auto Invest. The difference, however, is that with CoinLoan’s interest account, you can withdraw your money at any time, while with Bondora and Mintos, this is subject to the market situation.
You can activate your CoinLoan interest account in the currency you choose to deposit on the platform.
If you deposit Euros, you can activate the interest account in Euros and earn an annual interest of 12.3%.
How Fast Can You Withdraw Your Money?
Are you wondering how long it takes to withdraw your investments?
If using the interest account, you should be able to withdraw your investments immediately, although we haven’t tested this feature.
Currently we don't have any information about withdrawal issues. Some depositors frequently report about withdrawal problems on crypto lending platforms like Constant or BlockFi.
CoinLoan’s customer support is generally very responsive when it comes to handling verification and registration issues.
It’s worth mentioning that CoinLoan’s blog posts are informative and certainly provide higher value than most of the blog posts from other P2P lending sites like Wisefund or Lendermarket.
When it comes to answering our due diligence questions, CoinLoan never responded to our emails, which left us feeling wary of their services.
When trying to find the answers to our questions online, we researched what other users have said about CoinLoan, and were unable to find a one single source that could address our questions.
CoinLoan Review Summary
CoinLoan could be suitable for risk-friendly investors that understand all the aspects of crypto lending and are familiar with the risks which may lead to the loss of capital. The real return on CoinLoan is much lower than other platforms, however, unfortunately, we cannot say the same about the risk since the platform lacks transparency.
Key Takeaways From Our CoinLoan Review
- One of the least transparent crypto lending platforms we’ve reviewed
- Investments are secured with cryptocurrencies
- No presentation of the team
Coinloan was not able to address the above mentioned issues which is why we don't believe in the safety of Coinloans service. There are much better P2P platforms that deserve your attention.
Does CoinLoan offer a buyback guarantee?
CoinLoan does not offer a buyback guarantee as investments are secured by crypto-assets.
What kind of loans do investors invest in on CoinLoan?
CoinLoan doesn’t reveal any data about the borrower, loan-type or country origin of the loans investors fund.
How does CoinLoan guarantee returns?
Investments on CoinLoan are secured by crypto-assets. If the value of those assets drop, CoinLoan will liquidate them and pay investors back. Note, however, that by investing on Coinloan, you agree to the T&C which clearly say that you might lose your money.
Is Coinloan insured?
CoinLoan collaborates with BitGo which is a well-known custodian in the industry. The custodian provides insurance for investors uninvest funds. As soon as you chose one of CoinLoan's products, your investment is backed only by the crypto-collateral.
|Address:||Lastekodu 25-38, Tallinn, 10113, Estonia|
|Phone:||+372 634 6411|
|Opening Hours:||Weekdays from 9AM to 5PM|
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