The Facts BTCJam vs. BitLendingClub
I wanted to compare BTCJam and BitLendingClub, there are many opinions out there and I have my own. So above are the facts about the two different sites. Below you will find my opinions on the two for Borrow and Invest. Please provide comments on the what you think about the sites and please let me know if I missed anything.
Look and Feel of the Sites – BitLendingClub is better, but its close
Both sites allow you to easily invest and borrow in Bitcoin. However BitLendingClub, just seems to make it easier. I prefer the design of BLC over BTCJam, but that is not to say the BTCJ is bad. BTCJ does have issues with the Investments and Payment screens. If you are a serial investor of loans like me, and you have been on the platform a while you rack up loans. I have over 250 loans on my investments page and over 2100 payments pending on my payments page. This has caused some serious issues with loading and timeouts. BTCJ has a notes marketplace which allows you to sell your loans, BLC does not offer an equivalent. The notes marketplace is difficult to find tough and I feel it should be more prominent.
Information Verification – BTCJam but BitLendingClub is improving
They both offer roughly the same verification process. The way that the verification is tied to credit rating on BTCJam is better than BitLendingClub’s Identity Score. This for me is hands down better at reviewing loans and can quickly weed out loans. On BLC I feel I am mostly a coattail investor, looking to see what others have invested in and then reviewing the loan to see if I want to invest. I will discuss this later but with the lower volume of loans on BLC, it would be nice to quickly sort through listings by a credit score. While BLC offers the reputation score, that does not help for relatively new users, who may have a good credit score and income, but no real way of showing it.
Quality of investments – BTCJam
The volume of listings is low on BitLendingClub compared to BTCJam. There seems to be close to the same ratio of quality to horrible loans on both platforms. However, diversification is key in the P2P lending community as well as with Bitcoin. It takes much longer to diversify on BLC, when cherry picking only the good loans. I usually take a few day break in-between looking for loans. This has hurt my portfolio building. Where as on BTCJ I am there multiple times a day investing and doubling-down on previous investments. Quality new loans appear almost everyday, though occasionally there is a dry spell. There is a large amount of horrible loans on BTCJ but they are easily weeded out with the credit rating. BLC has bad loans as well but they are actively trying to get rid of scammers. It is harder to separate the High quality from the Mid quality loans on BLC.
Borrowing – Tied, depends on your style
I like borrowing on both platforms. I have had 6 loans on BTCJam and 2 on BitLendingClub. The sites take two different approaches. BTCJam allows the borrower to state the terms and conditions of the loan. However BLC allows the investors to determine the amount and interest rate they will invest at. While BLC’s approach should result in a loan being more likely funded, the volume of investors is not there as it is in BTCJam.
Borrow and Invest bitcoins
This makes it harder on the new borrowers, but borrowers with good reputation will fund quickly with attractive rates. BTCJam loans even for borrowers with a great history of repayments and credit score will have issues if they don’t pick the right terms. This may cause them to have to relist a loan with more favorable terms for the investors. If you want to edit your loan listing on both sites you will have to close the listing and create a new one. BTCJam provides your loan repayment information ahead of time because you set the rates, but BLC you have to wait until your loan is funded and you approve it before seeing your payment schedule.
Fees for Borrowers – BitLendingClub
It is pretty clear cut BitLendingClub has lower fees than BTCJam. 2% for loans under 10 BTC and 1% for loans over that, it is basically half of what BTCJ charges. BLC recently lowered fees and we will see if BTCJ follows suit. BLC also collects it’s fees from loan repayments while BTCJ collects it up front. The way BLC collects it’s fees encourages the platform to regulate and pursue scammers, whereas BTCJ has no incentive to go after scammers.
Communication – BitLendingClub
Hands down BTCJam does not even come close to communicating like BitLendingClub does. BLC’s CEO Kiril Gantchev is active on their forums, Hashtalk and Bitcointalk. Their support response times are much lower than BTCJ. Because of Kgantchev this is not even a competition, BTCJ are not even on the same level as BLC. The BLC forums go a long way supporting the P2P community, there is even a BTCJ section. BTCJ on the other hand has nothing, you will find pockets of people on Facebook, Hashtalk and BitcoinTalk.
Conclusion – BTCJam, it was close but BLC is growing
A lot of this comes down to personal preference with the size of the markets thrown in. I personally spend most of my time on BTCJam, with occasional visits to BitLendingClub. I am trying to invest more into BLC and you will notice that many investors invest on both platforms. The biggest advantage is market size for BTCJ, there is more activity there, but BLC is growing and catching up to BTCJam. BLC may be able to overtake BTCJ at some point in the near future. BTCJ could use a site redesign and this could carry them a long way. Both sites have issues with bad loans and you can easily go wrong with bad lending practices on BTCJ, while BLC makes it a little tougher getting rid of scammers, they still exist. For investing I would focus on BTCJ and occasionaly check out BLC. For borrowing I would go with BLC and if you can’t get funded there, then I would go to BTCJ.