Before we look at how Kudona helps you generate higher interest on your money, we need to compare the differences between our platform and a bank.
You should remember that we're not a bank. We offer a service that gives you easy, hassle-free access to the world of digital assets and decentralised finance.
That means we do things a bit differently.
A bank works as follows:
1. You deposit money into your bank account.
2. That money is loaned out in the form of mortgages, small business loans, credit cards, and more.
3. Whoever borrows money pays interest to the bank. On average, banks make 3-4% annually by loaning out your money.
4. This is then passed on to you in the form of interest. For the past few years, this interest has been consistently low. At present, the average interest rate in Europe on an overnight account (an account you can withdraw from any time) is 0.05%.
In contrast to a traditional savings account, we provide you with access to the world of digital assets and decentralised finance platforms, which can generate far greater interest returns.
That may sounds confusing. So here's a breakdown of how we can help you generate greater interest returns on your money.
*To guarantee repayment, the value of the collateral has to exceed the value of the borrowed amount at all times.
*To guarantee repayment, the value of the collateral has to exceed the value of the borrowed amount.
Now that you understand how Kudona operates, let's compare the benefits of Kudona to those of traditional finance products, specifically overnight accounts and one-year term deposit accounts.
Security and mitigation of risk is at the heart of everything that we do, but with anything in the world of finance, your capital always faces an element of risk.
We make sure we're always fully transparent with you. Which is why we want to highlight that the only way to generate a near risk-free return is through a bank account that's covered by deposit insurance.
Given the worryingly low interest returns from banks, this would mean leaving your money in a place where it's most likely to be impacted by the weight of inflation.
Inflation represents a significant risk to the real value of your savings.
While no service can be totally risk-free, at Kudona we provide maximum security of your assets at all times.
Below are five main areas that are key to this.
At the front of this is working with a strong banking partner, that ensures all transfers and withdrawals are protected in the best possible way.
We've partnered with a bank that is located, licensed and supervised in Europe.
When you transfer money from your current account to the account at our partner bank, we aim to swap it into digital assets on the same day.
Therefore, the risk of our partner bank failing and becoming insolvent on the same day is very limited.
Additionally, we have conducted stringent due diligence checks to partner with a bank that has a solid financial basis.
Kudona was created with a mission to bring interest rates back, and we've taken great measures to make sure that we have a sustainable business to allow us to carry that out.
We've assembled a team of highly-experienced professionals with decades of knowledge, have the full trust and commitment from our investors, and partnered with some of the largest financial companies in the world to help us succeed.
We understand that uncertain times mean you worry more about your money, and you may be concerned about what happens in the event that Kudona ceases to exist.
All digital assets are held in your name and are separate from company assets. This means, should Kudona cease to exist, you can simply request the transfer of the assets held in your name any time.
Any digital product is exposed to technical risks, but we mitigate them in multiple ways:
We understand that there are always concerns when it comes to the protection of your money.
To summarise, here are the most important points to remember:
Still have questions? Take a closer look at our FAQs.
That is exactly what Kudona is leveraging. Over the past decade technologies have emerged that replicated the model of a bank but without the inefficiencies of a bank.
These platforms also take deposits and loan out the deposits for higher interest rates to other market participants.
However, instead of a bank employee reviewing and approving transactions they operate fully automated through audited code. That allows for more efficiency and better interest being paid to you.