Wall Street giant Goldman Sachs offers first Bitcoin-backed loan
As the crypto adoption rises, Goldman Sach's entrance into the Bitcoin-backed loan business represents a major turning point in the industry.
American multi-national investment bank has offered its first Bitcoin-backed loan, enabling the borrower to use Bitcoin as collateral for the cash loan.
- As per Bloomberg reports, a spokeswoman from the firm confirmed that the Wall Street giant issued a Bitcoin-backed loan. She further explained that the deal was particularly interesting because of its structure and 24-hour risk management.
- It allows the borrower to obtain the money they require without having to sell their coins. There is, however, a risk factor due to the volatility of the market.
- The company has invested in crypto startups, and has offered Bitcoin derivatives and over-the-counter trading services. Recently the investment bank announced that it is venturing into NFTs and tokenization of financial instruments.
- While Goldman Sachs may have been the first bank to offer a Bitcoin-backed loan, there are other players in the market offering crypto-related financial products. On Wednesday, BlackRock, an asset management firm, announced its blockchain-focused exchange-traded fund (ETF), and earlier this week, DeFi protocol Portal collaborated with HighCircleX (HCX) to tokenise pre-intital public offering (IPO) company stocks.
- Recently, real estate blockchain platform Propy and Abra teamed up to offer house loans guaranteed by their cryptocurrency holdings. In the month of April, crypto company XBTO began offering Bitcoin-backed mortgages in Miami.
Edited by Anju Narayanan
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