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Major credit card issuers may have banned purchases of bitcoins, but they do not interfere with style students. According to a recent poll of the US-based Student Loan Report, more than a fifth, or 21.2% of university students, direct funds for financial assistance to invest in the best cryptocurrency. This is a risky gamble, which could pay dividends or leave students with more debt than they initially inherited in a context of rising interest rates.
The Student Loans Report asked students without hesitation: “Have you ever used student loan money to invest in cryptocurrency like Bitcoin?”
Interest Rate Confrontation
In the United States, 1.4 million college students turn to private loans to finance their education, while the majority of them use federal loans. With rising interest rates, these students might be forced to pay higher interest rates than the ones they had negotiated.
Meanwhile, students have access to cash because lenders usually send excess funds once the courses are repaid to the borrower. The funds are supposed to be used to finance living expenses, but investment-savvy young adults place this category in an asset class that could generate higher returns than anywhere else on the financial markets. traditional. Students are not required to disclose how the extra money was spent. The report mentions Bitcoin, Ethereum, Ripple and more.
The Student Loan Report surveyed university students over a period of several days in March, when the price of bitcoin was under pressure. But 2017 is not far enough in the rearview mirror for them to remember the potential returns that bitcoin and some altcoins can offer, given the gangbuster performance of 2017. The period that students were surveyed is reflected in the bitcoin price table below –
Blockchain Veteran’s Council
If lenders understand the risks faced by students, they might impose stricter controls. Consumers freely used their credit cards to invest in Bitcoin until JPMorgan, Bank of America and others in February said they could not do it. Prior to the credit card ban, nearly 20% of Bitcoin investors made their purchases with a credit card, as reported by LendEDU in CNBC
Returning on the advice of veteran blockchain Wences Casares, he told Dan Schulman of PayPal: “The main way that bitcoin could fail is to start putting bitcoin money we can not to lose.”
Image from Shutterstock to photo
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