Coinbase launches crypto lending platform for US institutions


Cryptocurrency change Coinbase has rolled out a crypto lending service for institutional buyers within the United States, reportedly aiming to capitalize on large failures within the crypto lending market.

Coinbase has quietly launched an institutional-grade crypto lending platform, Coinbase Prime, to U.S. buyers, in response to a Bloomberg report on Sept. 5. Coinbase Prime is a full-service prime brokerage platform that lets institutions execute trades and custody belongings.

“With this service, institutions can choose to lend digital assets to Coinbase under standardized terms in a product that qualifies for a Regulation D exemption,” the agency reportedly mentioned within the assertion.

According to a submitting with the U.S. Securities and Exchange Commission, Coinbase prospects have already invested $57 million within the lending program for the reason that first sale occurred on Aug. 28. The providing had attracted 5 buyers as of Sept. 1.

Data from a SEC submitting by Coinbase Credit. Source: Coinbase SEC Filings

Coinbase didn’t instantly reply to Cointelegraph’s request for remark.

The new crypto lending product by Coinbase follows the halt of new loan issuance on Coinbase Borrow in May 2023. The program is designed to permit customers to obtain as much as $1 million via Bitcoin (BTC) collateral. The new institutional program is operated via Coinbase Credit, the identical entity that manages Coinbase Borrow.

Related: SEC vs. Coinbase: New lawyer Patrick Kennedy joins fight

The information comes months after the U.S. SEC charged Coinbase with alleged providing and sale of unregistered securities in reference to its crypto starking companies, which permit customers to earn yields on giving their crypto to the platform. The change opposed the SEC’s allegations, arguing that it strongly disagreed with any allegations that its staking companies had been securities.

Coinbase ultimately needed to pause its staking program in 4 states — California, New Jersey, South Carolina and Wisconsin — whereas the proceedings had been going ahead.

The crypto lending trade was hit with a large disaster final yr, with main firms like BlockFi, Celsius and Genesis Global going bankrupt amid a scarcity of liquidity attributable to the bear market of 2022. Some crypto fanatics mentioned that the crypto lending sector should study classes from the collapses and solve issues related to short-term assets and short-term liabilities.

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