Coinlend receives HTGF seed funding for its AI-based lending platform tailored to the cryptocurrency market
March 27, 2019
Coinlend’s AI-based technology automates, monitors and maximizes interest
generation through margin funding – the secure financing of leveraged trading
positions – in the cryptocurrency sector. In February 2019, the HTGF did invest in the
company in the six-figure range.
The major trading exchanges in the cryptocurrency sector offer their users the opportunity to
lend their funds to day traders in the form of short-term loans in addition to the actual trading
in crypto and fiat currencies. The traders use the borrowed funds for so-called margin trading
and the lender receives interest for the provision of the capital. Coinlend offers an online
service that completely automates the lending process, optimizes interest income and saves
the user of a lot of time and effort.
Margin funding works as follows: Margin traders bet on e.g. rising prices of cryptocurrencies
with so-called leveraged transactions. To do this, traders often need additional borrowed
capital in order to maximize their profit opportunities. Any user of the exchange can provide
this capital via P2P margin funding and therefore can receive a corresponding interest
payment. When lending Bitcoin, the average interest rate in 2018 was around 6%, and in
2017 even 25%, which makes lending in cryptocurrencies very attractive for every investor,
especially with regard to the compound effect.
And this is where Coinlend’s service comes in: manual lending of currencies on the
exchanges is very tedious and time-consuming. The user interfaces of the exchanges are
confusing and hard to understand for beginners. In addition, the loans often have a very
short duration of two days and can be repaid prematurely by the margin trader at any time.
Thus the coins accumulate in the wallet without interest payment until they are manually lent
again by the user.
This is why Coinlend was created. Once set up, the artificial intelligence behind Coinlend
automates the creation of loans and optimises the user’s interest income. After entering the
API credentials of the desired exchange and defining the basic conditions (such as minimum
interest rate, term, etc.), the technology created by Coinlend starts its work and lends the
user’s coins fully automated – at the best possible interest rate and around the clock.
Coinlend offers comprehensive statistics and evaluations on current loans and future
developments. Setting up the bots is quick and easy, step-by-step guides are also available
for inexperienced users.
Jan Pumpe, co-founder and managing director of Coinlend GmbH, is pleased with the
successful financing round: “The HTGF stood out from a large number of VCs who showed
equal interest in the technology and the team – the technological focus and location in
Germany of the HTGF was a perfect match to our existing shareholders. With the support of
HTGF, we are able to further accelerate our growth and further strengthen our dominant
position over our competitors”.
“We were impressed by Coinlend’s user reach, coupled with the solidly developed software.
We are convinced that financial intermediaries will increasingly disappear and that
peer-to-peer lending, especially through blockchain applications, has a great future ahead of
it,” said Tobias Schulz, investment manager at HTGF.
About Coinlend GmbH
Coinlend GmbH is a Mannheim-based, globally active SaaS company that offers solutions
for the automation and optimization of margin funding in the cryptocurrency sector. The
GmbH was founded in 2017 and since then provides the world’s leading online platform for
the automation of crypto and fiat currencies on all relevant margin funding exchanges.
About High-Tech Gründerfonds
High-Tech Gründerfonds (HTGF) is a seed investor that finances high-potential, tech-driven startups. With EUR 892.5 million in total investment volume across three funds and an international network of partners, HTGF has already helped forge more than 520 startups since 2005. Driven by their expertise, entrepreneurial spirit and passion, its team of experienced investment managers and startup experts help guide the development of young companies. HTGF’s focus is on high-tech startups in a range of sectors, including software, media, internet, hardware, automation, health care, chemistry and life sciences.
To date, external investors have injected over EUR 2 billion into the HTGF portfolio via about 1,400 follow-on financing rounds. HTGF has also successfully sold interests in more than 100 companies. Investors in this public-private partnership include the Federal Ministry For Economic Affairs and Energy, the KfW Banking Group, and Fraunhofer-Gesellschaft e.V., as well as the companies ALTANA, BASF, BAYER, B.Braun, Boehringer Ingelheim, Robert Bosch, BÜFA, CEWE, Deutsche Post DHL, Dräger, Drillisch AG, EVONIK, EWE AG, Haniel, Hettich, Knauf, Körber, LANXESS, media + more venture Beteiligungs GmbH & Co. KG, PHOENIX CONTACT, Postbank, QIAGEN, RWE Generation SE, SAP, Schufa, Schwarz Gruppe, STIHL, Thüga, Vector Informatik, WACKER and Wilh. Werhahn KG.