BTCJam is a Peer-to-Peer lending network that allows people to invest and borrow bitcoins. They advertise an average 19% Return of Investment (ROI) as a performance metric for their loans. There is no guarantee on that rate. My NAR is good so far, but it has only been about 45 days. I think the NAR really starts getting effected when the defaults start kicking in.
Net Annualized Return:
It started at around 50% and slowly falls…
Here is my repayment information:
Late 1-30 days: ฿0.0655
Late 31-120 days: ฿0.0114
I immediately re-invest whenever someone pays me back so I put up an initial 2.5 BTC of my own money. I don’t think that these shows the loans that I invested in, but have not been activated yet. If you invest in a bad loan, then you will lose your bitcoins. The loans can be linked to Bitcoin or to another currency. I used this site extensively over February and March of 2015 and here are some of my results. I mostly used the investment tools, but I did take several small loans out to experiment with the process. I have only been there for about 6-7 weeks, so I am assuming it is going to go lower and hopefully it does not turn negative, but I could be wrong. It was mostly a trial anyways, so this was not a huge amount of money to lose if I do lose it, but it might make a return since my NAR is still doing OK. I will update this article with my future findings.
If a borrower links there loan to the USD, then they have to pay back the amount of USD that they borrowed and the number of bitcoins that equates to this amount will fluctuate. If the price of a bitcoin rises, then they will have to payback fewer bitcoins and the lenders will receive fewer bitcoins. Well, unless if the interest is higher. This goes the other way, also. If they price of a bitcoin falls in between the time of the funding and when the borrower pays back, then the lender will receive more bitcoins back then they invested. The loans can also be tied to bitcoins. If bitcoins triple in value, then the user would still have to pay back an equal number of bitcoins which could be a much larger USD price than cashed out from the loan. This also works the other way. If bitcoins go down in value, then can buy bitcoins for a lesser price to pay the loan back.
There are a lot of scams on BTCJam and there are a high number of loans that do not get re-payed. I have been investing in various loans in February and March. Below is a screen capture of the performance of my BTCJam loans in a neatly formatted calendar. When there are duplicate names on a specific date, that means that I made several small investments in the loan. That was because I was logging in several times a day and reinvesting in new loans with the money that received from past loans. I think they should collapse all those into one, but that is probably low priority compared to all of the other tasks that need to be completed and problems solved.
Here is the calendar for February:
Here is the calendar for March: