![banknotes941246_640.jpg](https://i.imgur.com/3qGZKnH.jpg)

In recent years we have witnessed the failures and closure of one too many crypto lending platforms.. Not just that, but even DeFi and other high yield platforms have been under intense scrutiny and many have failed to live up to expectations. It is no surprise then that the community has reservations on things like HBD interest APR and the issue of lending.

Lending is serious business, but more importantly it is a risky one. Bad loans are a problem and have affected some of the biggest financial institutions over the World. What's more, giving out loans excessively without effective collateral and KYC is almost asking for certain failure. Even with these things provided, there is still the very big risk of default.

I think the issue of a lending platform for Hive is inevitable, but it is way too premature to have. We have a relatively small userbase that should continue to focus on other areas like content creation, gaming and community development. As far as finance goes, we should stick to advisory and investing that leofinance and a few other second layer platforms provide. There is absolutely no need for it.

Even if we do so with a justification that it will be aimed primarily at supporting those who have project development and community building in focus, it is still needless. As of now, what Hive needs are investors and a healthy community base that shows the World how an integrated Web3 chain looks like and the possibilities. Lending is one high risk venture that won't necessarily take us closer to our goals.

It is also worth mentioning that personal lending is already taking place on the platform. I understand the Neoxian community does this for its members and have come across one or two Hive users who have benefitted. It seems to have worked fine, but that is on a much smaller scale than having it as a focus and perhaps Neoxian will share with us his lending story so far someday. 

I actually viewed lending as something quite favorable a few years back, and envisaged a situation where we can leverage on the platforms reputation system to issue out loans. Yet, the reputation system might be one way to reduce risk but it is not necessary for us to expose ourselves to such risk. I understand the numbers from a profit perspective, but it almost feels like what we bring against with putting short term profits ahead of the long term health of the system.

Posted Using [LeoFinance <sup>Beta</sup>](https://leofinance.io/@empress-eremmy/hive-could-be-the-lending-platform-that-works-but)