MakerDAO Loans Review
- Retail Borrowers
- Arbitrage Traders
- Blockchain Focused Companies & Businesses
- Hedge Funds & Market Makers
Maker is a decentralized lending platform powered by smart contracts on the Ethereum blockchain. Users lock their Ethereum in a CDP (Collateralized Debt Position) smart contract and are issued DAI as a loan. Security history, full transparency, global availability, and privacy have made Maker the most successful decentralized lending platform to date.
MakerDAO Crypto Loans - 2020 Comprehensive Review
|Rate Variability||High Variable|
|Loan Amounts||$1 - $1,000,000|
|Receive Funds||Stablecoin : Instant|
|Repayment Type||Interest Only|
|Collateral LTV||66% - 66%|
|Margin Call LTV||66%|
|Platform Fees||Margin Call Fee: 5%|
|Token Benefits||Holding MKR comes with voting rights within MakerDAO to set APR rates and accepted collaterals.|
|Platform Type||Decentralized Lender|
|Supported Regions||All Countries|
|Excluded Regions||No Exclusions|
|Borrow Asset||APR Rate|
|Collateral Asset||Collateral LTV|
MakerDAO Crypto Loans Alternatives
Pros and Cons
- Transparency - All locked collateral, stability s, liquidations, and protocol data can be viewed by anyone on the Ethereum blockchain.
- DAI - DAI is the only censorship resistant stablecoin available and can only be minted through the Maker CDP (Collateralized Debt Position) portal smart contract.
- Global Availability - The MakerDAO CDP (Collateralized Debt Position) portal is a decentralized protocol built on top of Ethereum and is open to anyone with an internet connection.
- Governance - Maker Dao is a decentralized organization that is governed by it’s token holders. MKR token holders can lock their tokens into a smart contract and vote on protocol upgrades and changes to the CDP platform.
- Privacy - Maker is a decentralized protocol governed by smart contracts. Users are not required to register, KYC, or submit any personal identification documentation in order to access loan services.
- Wallet Support - The MakerDAO CDP (Collateralized Debt Position) portal supports the following wallets, enabling a far more secure user experience: MetaMask, Ledger Nano S, Trezor, and Coinbase Wallet.
- Balances Are Not Insured - Decentralized lending platform protocols do not operate under traditional finance licenses and regulations. It is the responsibility of the user to keep their wallet secure and understand that their crypto backed loans are not insured.
- Smart Contract Risks - To date there have been absolutely no security issues with the Maker CDP (Collateralized Debt Position) smart contract. Of course, this is not an indication of future results and users should be aware that the higher returns are partly due to the risk involved in new and innovative financial products.
- Native Ethereum Assets Only - The Maker CDP (Collateralized Debt Position) smart contract runs natively on Ethereum. As a result, only ERC-20 compatible assets are available on the platform.
Frequently Asked Questions
Is securing a loan on Maker safe?
The MakerDao system has been operating since Q4 2017. The smart contracts utilized on the platform have been audited, tested, and scrutinized more than any other open finance based protocol. Taking historical security into account, obtaining a loan via MakerDAO is safe.
What is a Collateralized Debt Position (CDP)?
A collateralized debt position, also known as a (CDP) in the MakerDao system, is created when a user enters an agreement via smart contract. This agreement enforces that the borrowed amount must be repaid in order to retrieve locked collateral (Ethereum) back from the system.
Does Maker support crypto-to-fiat loans?
No. Only crypto-to-crypto loans are available on the Maker platform.
Does Maker require users to KYC in order to obtain a loan?
There is no KYC process or account creation required when using the Maker platform. Maker is available globally without restrictions.
Are Maker loans insured?
The Maker platform is powered and governed by Ethereum smart contracts. All loans are purely crypto-to-crypto and as a result there is currently no insurance on user balances.
Maker Loans Summary
MakerDAO is the first open finance protocol to launch on Ethereum and continues to play an essential role in the decentralized finance movement. Community governance, full transparency, an open source code base, and secure smart contracts have all contributed to the platform’s success.
While available globally with full transparency, crypto asset loans on the platform are currently only issued in DAI. This creates a moderately difficult user experience for entry level users when compared to other crypto lending platforms.
Blockfer recommends the MakerDAO platform for privacy focused users and individuals in countries with aggressive regulations.
Learn More Best Features
MakerDAO Official Website
- No KYC Required. MakerDao is Currently The most decentralized crypto lender.
- Borrow DAI with up to 66% LTV on Ethereum ETH.
- Variable interest rates during the life of the loan; Loan APR rate may lower from what orgininally borrowed.
Legal & Regulation - Facts & Figures
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Methodology: How We Review And Compare
Our mission is to provide the most informative, unbiased, and useful reviews and comparisons possible for products and services in the blockchain finance industry. Assessments are powered by experts with years of relevant experience.
The crypto lending platforms found in this category have been tested extensively by our team as part of the review process. Factors we analyze in our crypto loan reviews and comparisons include: APY rates, available assets, loan amounts, loan options, LTV ratios, platform fees, reputation, ease of use, loan terms and fees, and customer support.
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