Coinbase, a cryptocurrency exchange, has become the first digital asset company to receive a bitcoin-backed loan from Goldman Sachs.
Coinbase receives a loan from a Wall Street giant
One of the biggest names in the cryptocurrency market, Coinbase, has announced that it will receive the first-ever loan backed by bitcoin from Goldman Sachs bank. Neither the bank nor Coinbase has provided any details about the term or amount of the loan.
Cryptocurrency companies and decentralized protocols have used Bitcoin-based loans for a while. However, a recent move from Goldman Sachs that gave the green light to this type of action, including support for Coinbase, suggests that Wall Street is increasingly getting into the cryptocurrency market.
Bret Tejpaul, vice president of Coinbase Institutional, told Bloomberg that the decision marks a step towards treating cryptocurrencies as a security, as well as a bridge between fiat currencies and digital coins.
A spokesperson for Genesis, Matthew Ballensweig, stated that the loan-to-deposit ratio remains in the range of 40% to 60% when bitcoin is used as collateral. For example, when we borrow $ 100, the value of bitcoin ranges between $ 167 and $ 250 as collateral remains with the lender.