Coinbase Gets Guaranteed Bitcoin Loan

Coinbase Gets Guaranteed Bitcoin Loan
Written by Arindam
Coinbase Gets Guaranteed Bitcoin Loan

Coinbase, one of the major crypto exchanges, has been granted the first guaranteed loan in Bitcoin by American investment bank Goldman Sachs. The loan seeks to bridge the gap between normal currencies and virtual assets including cryptocurrencies. This indicates that the financial industry in the US is changing its attitude towards the crypto segment.

Coinbase Institutional Head Brett Tejpaul said that this initiative by Goldman Sachs will increase the importance of cryptocurrencies as collateral. Usually, real estate or gold is kept collateral against the loan. However, the amount of this loan given by Goldman Sachs is not known. Due to the volatility in bitcoin, it falls in the category of loan risk. According to Gadgets 360’s price tracker, the price of bitcoin is around $41,700. Industry experts say that this experiment of Goldman Sachs is a test before a big step.

Financial services firm Arca said in a report, “There could be a major reason behind such agreements. There is a possibility that Goldman Sachs is getting a lot of demand for such loans and will not take any major steps before taking any action.” Taking stock of the market.” Goldman Sachs does not offer crypto trading services. However, it provides services related to crypto exchange traded funds (ETF) and options trading to its clients. In addition, it is also looking to offer over-the-counter options trading for Ethereum.

However, apprehensions are also being raised about loans in bitcoin. For example, rating agency Weiss Ratings recently warned that there is a higher risk with guaranteed loans in cryptocurrencies. A report by Allied Market Research last year said that the crypto segment could grow at a CAGR of 12.8 percent by 2030. The market capitalization of the crypto industry was over $2 trillion as of the end of March. The crypto market is going through a recovery phase. Industry experts believe that the volatility in this segment may decrease as the number of countries that bring the virtual assets segment under the legal framework increases.

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