Banks can offer a handy service. They give us the option to store our money safely without worrying about having paper money all over the place which we can get lost or accidentally destroyed any moment. But, as much as banks can be useful, there are a lot of sketchy things they can get away with, especially when we talk about consumer credit and its inherent issues.
Another problem with today’s banks is the centralization they have enjoyed, leaving out of the competition other options that might offer better lending services.
However, we’re living a moment in history where blockchain technology and the revolutionary Ethereum platform are bringing upon us a more decentralized world.
That has consequences for the future of lending businesses. Mainly, the popularization of decentralized lending.
Ethereum has allowed for many new startups to see the light of day and bring new services that improve our lives, and consumer credit is an area which can benefit from this decentralization.
That is where Celsius comes into play.
Celsius is an upcoming project that offers blockchain lending. That is the possibility of taking loans through the blockchain (a decentralized public ledger which records every transaction) and the smart, self-executing contracts allowed by the Ethereum platform.
Another similar project is the SALT lending service, which also looks to decentralize the process of lending money away from today’s dominance of established banks.
Nevertheless, what’s essential to the consumer is: Which option is the best?
And for this, we shall compare both competitors over several points:
One of the reasons we are praising blockchain credit is that it allows for more lenders to enter the market without the issue of being consistently and permanently obscured by financial institutions.
Celsius does a great job doing this since it gives lenders the opportunity of entering an environment free of over-identification which allows for users to choose lenders based only on their reputation as a lender in the platform.
SALT, however, looks to bridge the gap between financial institutions and blockchain services, thus allowing for already-established banks to enter the market and potentially obscuring emerging users just like they do today.
While Celsius operates a wide selection of consumer credit services, these options (and their long-term goals) might confuse new users not used to the world of smart contracts.
On the other hand, SALT offers a user-intuitive interface which shows lending options and clients can just choose the one that fits their needs the most.
While SALT does an excellent job at managing security, their whitepaper does not go too deep describing this, leaving many questions unanswered.
Celsius, on the other hand, offers a decentralized lending that rates customers by how effective they are, based on a rating system which classifies them per credit or paying responsibility and can even expel them from the app or allow users to vote for it.
- Long-Term Goals.
Overall, we have to give Celsius the upper hand since they are looking to create a self-governing environment which empowers users to regulate their market and offering the reputation meter mentioned above which filters risky users with a higher default probability.
And from here, they’re looking to empower blockchain platforms by making them more trustworthy and less risky.
SALT, on the other hand, seems to only focus on blockchain lending without no different goals other than helping its customers’ acquisition power.