Lending at Bitvavo

Summary

This article explains how Lending at Bitvavo works, how you can participate, and what to expect when buying certain assets that require Lending participation. You'll also find information about how rewards are calculated, when they’re paid, and what to do if you no longer wish to take part in Lending.

What is Lending?

Lending at Bitvavo allows you to earn rewards on supported crypto assets by making them available to trusted parties. Bitvavo Custody BV lends your assets to professional market makers. These partners use the assets to provide liquidity on Bitvavo, helping ensure smooth and competitive trading for everyone. In return, you earn weekly rewards on the assets you lend.

There are two types of assets in the Lending program:

• Global Lending for all assets: Lending is optional and can be enabled or disabled in your account settings.
• Lending-enabled assets: In exceptional cases, an asset requires your explicit consent to participate in Lending before you can buy them.

By enabling Lending for a specific asset, you allow Bitvavo to lend that asset to market makers when there's a temporary imbalance between available inventory and demand. This can happen during short periods of increased interest in an asset. Lending helps ensure that market makers can continue to operate efficiently, even when demand is unexpectedly high.

Lending-enabled assets are classified based on real-time demand and may change over time. This is a temporary and exceptional measure that is reversed once the imbalance is resolved. Lending is only used to provide liquidity at Bitvavo.

How can I participate in Lending at Bitvavo?

There are two ways:

1. Global Lending Opt-in
   You can enable Lending for all assets with one setting in your account. Your participation is always optional and can be disabled.
2. Required Lending for Lending-enabled assets
   For some assets, Lending must be enabled before you can buy them. This way, we can make sure that the price of the asset on Bitvavo is more stable, ensuring a fairer exchange price for those that want to buy or sell the asset. In return, you automatically receive rewards on these assets.
   These assets are known as Lending-enabled assets. When you try to buy one, you’ll be asked for your consent. Once you opt in, your consent will apply to all lending-enabled assets going forward. You’ll start earning rewards automatically for all assets classified as lending-enabled.

Note: Lending-enabled asset classification is dynamic and based on real-time market conditions. These events are typically rare and happen only during periods of increased demand, when more lending support is needed.

You can find more information in our Risk Disclosure and Terms and Conditions.

How do I opt out for these lending-enabled assets?

For assets where lending is optional, you can enable and disable lending in the Lending settings menu. You can find this through the Lending tab available on assets that support Lending, or by tapping the profile icon on the top-right in the app and scrolling down to 'Lending settings'.

For lending-enabled assets, you can’t disable Lending manually in your settings at this point in time. If you no longer wish to participate in lending for these assets, you can:

• Sell the asset
• Withdraw the asset

Note: Lending participation for these assets cannot be reversed within the platform once you’ve opted in. If you do not want to participate in lending for these lending-enabled assets, you need to sell or withdraw all lending-enabled assets.

How are Lending reward rates determined?

Bitvavo Lending reward rates are dynamic and influenced by supply and demand in the market. They are reviewed regularly and may change over time. For more information, you can refer to Bitvavo’s pricing policy.
You can view current rates for global lending directly in your Bitvavo account or on the Earn page. You can find all lending-enabled asset reward rates at the bottom of this page.

Are there any restrictions once I lend my assets?

You can still trade or withdraw your assets as usual. There are no lock-up periods or cooldowns.
Note: For Lending-enabled assets, your consent is binding as long as you hold the asset. To stop participating, you must sell or withdraw the asset.

Who are Bitvavo’s Lending partners?

Bitvavo only lends to professional market makers. These partners help increase liquidity and improve pricing for you and other users. As such, the assets do not leave the Bitvavo platform. Each partner undergoes rigorous checks on credit risk, security, and operational performance. Lending is only used to provide liquidity at Bitvavo.

What are the reward rates for lending-enabled assets?

The reward rates for lending-enabled assets will be shared soon.

FAQ