

New Bitcoin lending platform: BitLendingClub Beta is now live - BitLendingClub

We are glad to announce the launch of BitLendingClub Beta. BitLendingClub is a peer to peer bitcoin lending platform which uses Dutch auction-style lending in order to offer borrowers the most efficient rates and to provide lenders with the best return on investment. Another key feature of our business is that we only collect loan fees when the loan gets repaid. To be more precise: our fee is 1% of the loan and each time the borrower makes a payment, we factor out 1% to cover the loan fee. This approach gives our lenders the confidence that BitLendingClub also has a financial stake at reducing defaults.<p>Be the first to join us and find out abut the great features we offer to our customers:<p><pre><code>  * Dutch auction-style lending.
  * Efficient interest rate discovery.
  * Peer-to-peer lending platform.
  * Close partnership with lenders to maximize return on investment.
  * Loan fees only collected when the loans get repaid.
</code></pre>
As much as we&#x27;re excited about the launch, we would still like to let you know 
that we&#x27;re in Beta. There may be some minor issues with the website, but we&#x27;re 
always available to address any problems via chat or e-mail. Do not hesitate to 
contact us and share any problems that you notice. With that said, please join 
our website and help us deliver the best lending platform for your needs.<p>With Kind Regards,  
The BitLendingClub Team<p>http:&#x2F;&#x2F;www.bitlendingclub.com
======
ig1
Doesn't look serious.

First pass:

    
    
      * Doesn't list a regulator, probably unlicensed money lender
      * Company about page is empty, no registered company address or identity
      * No legal jurisdiction given. 
      * No evidence on who the team is and what they're experience in loans are 
       (legal, risk, etc.)
      * Empty T&C - probably means you don't even have lawyers, can't find lending 
        contract anywhere on site, does one even exist ?
    

And the list could go on.

It's like launching Amazon without having any books or the logistics to handle
ordering.

There's also a decent chance the site as it exists (even if it's not currently
processing loans) might violate the law (in a "Go to jail, do not pass Go"
sense) depending on where it's operating from.

This is the kind of business where you have to have a lawyer, because there's
so many things going on which can have serious legal repercussions.

~~~
BitLendingClub
Hi, Thanks for the constructive criticism, we are working to address all of
our clients' and potential clients' concerns in a timely manner.

First and foremost, I'd like to make a clarification: we're not a money
lender, we only facilitate the lending. Lenders sign up on our website, fund
their accounts with BTC and they decide who to lend to, at what interest rate
and how much to fund loans for. BitLendingClub does not perform any funding
itself.

Bitcoin lending, and Bitcoin in general, don't fall under any particular
state/country's regulatory jurisdiction. As such, it's not necessary for us to
register with any regulators as long as we don't facilitate lending of some
state currency, such as USD, EUR, GBP, etc. I live and operate this website
from Chicago, IL, but based on the current statements from the government and
since we only allow lending with Bitcoins, it doesn't seem like we have to
comply with any specific lending regulations within Illinois or the states.

I've updated the company page to include the corporate information:

BitLendingClub is owned by Tanager, Inc registered in the State of Illinois in
October 08, 2009. File number: 66992225 Name registered under: Kiril Gantchev
Address registered under (residential): 217 N. Park Blvd. Streamwood, IL 60107
Please feel free to look up the corporate information at
[http://www.ilsos.gov/corporatellc/CorporateLlcController](http://www.ilsos.gov/corporatellc/CorporateLlcController)

With regards to the team: people can find out about the team by visiting the
About Us page ([http://bitlendingclub.com/content/about-
us](http://bitlendingclub.com/content/about-us)). The page lists the CEO
(myelf) and the CTO of the company as well as links to our LinkedIn profiles.
The LinkedIn profiles include our current employers and cities where we
live/work. I live and work in Chicago, IL and a cursory search in google will
confirm all of that information. Both of us are software developers, so we
don't have particular experience in loans, but we hope that the key aspect
we're going to resolve is providing the platform where people with experience
in lending can conduct lending.

The T&C is empty because we're still in Beta and we were more focused on the
functionality rather than the content. We're working with our lawyer to draft
a T&C prior to completing the Beta.

Best Regards, Kiril Gantchev CEO of BitLendingClub

~~~
ig1
You seriously need to get a lawyer, just because you're using bitcoin doesn't
mean you don't fall under any jurisdiction. You are governed by your state and
national laws.

Financial laws don't just apply to money, they apply to a wide range of assets
classes. Plus it's not just money lending laws you need to be concerned about,
look at the action letter served by the SEC in 2008 against peer-to-peer
lenders for serving as an alternative investment asset class without proper
licensing. The same likely applies to you.

Proper legal works will also protect you when one of your users sues you
(which incidentally your insurance is unlikely to protect you against unless
you negotiated a specialist deal) or the feds bust you when your service is
used for money laundering (as has happened to other bitcoin financial
services).

You should be able to legally setup and operating a bitcoin lending platform,
but you need to make sure the paperwork is in order. You probably need either
a specialist lawyer in the founding team or at least someone with deep
experience of the lending space who can guide you through the hurdles.

------
t0
How will you combat the huge amount of fraud?

~~~
BitLendingClub
It's a challenge, but people are willing to take risks at the moment despite
there being fraud. We're verifying IDs, addresses, phone numbers (coming
soon), social media profiles and we have a comment section with each loan so
lenders can ask borrowers for additional information.

Our main competitor is btcjam.com and people have funded over 15k BTC worth of
loans in the last year. We're hoping to offer a better platform and we're also
eventually looking to target a slightly different borrower segment.

Our main recommendation is that people don't invest a lot of money in a single
loan. Investments should be split up into small chucks and spread out
accordingly. If a particular borrower's credit history is lacking, but their
loan request is fairly big, then the lenders should probably avoid funding
that loan. We're also going to integrate with WoT and integrate all the loans
terms with the block chain, so people can monitor lending transactions/credit
ratings just by scanning the block chain for our transactions.

In the future we're hoping to provide more standard ways to collect on
defaults and insure loans.

------
LexanneLexanne
I need to learn about bitcoin investing. Can you direct me to anyone?

~~~
BitLendingClub
I would suggest you visit
[http://www.reddint.com/r/Bitcoin](http://www.reddint.com/r/Bitcoin) on or
[http://bitcoin.stackexchange.com](http://bitcoin.stackexchange.com) and post
your questions there. I would NOT recommend that you begin investing unless
you have a descent understanding of bitcoin and investing in general. There is
a lot of fraud now and the people that are likely to lose money are the ones
that are not very familiar with the various aspects of investing and bitcoin.

------
LexanneLexanne
I need to learn about bitcoin investing but I'm almost computer illiterate.
Does that exclude me?

~~~
BitLendingClub
With respect to your computer literacy skills, you seem to be doing pretty
fine if you're posting here :). With that said, I still wouldn't recommend
investing in bitoin unless you understand the technology behind it and you
understand some basic about investing in general.

