lending your BTC to gaming sites you are at risk of losing your entire capital. also for the returns you are at the mercy of the site operator.
BTCJAM allows you to lend to many different borrowers under conditions and rates that you set. So you avoid putting all your eggs in one basket. You may lose a bit of capital on a bad deal, but you can minimize risks by lending small amounts across many lenders, and do your due diligence.
The downside of BTCJAM is that it just seems like a lot of work.
Honestly BTCJAM is not ideal, but there is nothing better just yet. I think there is a huge biz opportunity to fill this market gap to provide reasonable returns on BTC investments (while protecting capital).
I would love to use my BTC to give loans, but whats the point when the guy getting a loan can default and nothing will happen to him? People will keep getting loans and defaulting and disappearing, now thats how you double your stack.
Loaning people your money is a good way to lose it all quickly and all for what? A tiny piece of interest? Most people will likely just take out loans to pay them back until they build up enough confidence to take a big chunk and run off with it.