Lenders, Brokers Skeptical About Merchants Using Domain Names as Loan Collateral

An informal LinkedIn poll suggests that only 26% of respondents believe merchants would be willing to use their business’s website domain name as collateral for a loan, if given the option. In contrast, 48% of respondents outright doubted that merchants would consider using their domain name for such purposes. Interestingly, many secured loans that include liens on all assets already encompass domain names among those assets.

In April, FundScope predicted that loans specifically using a domain name as collateral could become a reality soon. The following month, a domain registrar partnered with a peer-to-peer lending site leveraging blockchain technology. In fact, the first-ever domain name loan executed by smart contract occurred earlier this year in January, facilitated by FundScope.