Goldman Sachs made history in the cryptoverse after issuing its first-ever Bitcoin-backed loan in late April. Now, a new report shows that Coinbase (NASDAQ:COIN) has partnered with Goldman Sachs (NYSE:GS) to release the bank’s first Bitcoin-backed loan.
Goldman Sachs Partners With Coinbase
A recent report has unveiled Coinbase, the United States’ largest cryptocurrency exchange, as the mystery firm that has taken on Goldman Sachs’ first Bitcoin-backed loan.
According to the report, the Bitcoin-backed loan issued by Goldman Sachs would deepen ties between the crypto and tradfi world. Head of Coinbase Institutional Brett Tejpaul stated that:
“Coinbase’s work with Goldman is a first step in the recognition of crypto as collateral which deepens the bridge between the fiat and crypto economies.”Although the exact value of the loan remains undisclosed, the loan was collateralized by a portion of Coinbase’s Bitcoin holdings. The exchange currently holds 4,487 bitcoin, worth around $170 million as of today’s prices.
Bitcoin-backed loans aren’t new, and, according to Matthew Ballensweig of Genesis trading fund, his firm has already structured similar loans with Silvergate and Signature Bank (NASDAQ:SBNY). They are also “exploring similar structures with large investment banks that want exposure to the space.”
On the Flipside
- The Securities and Exchange Commission (SEC) is looking to hire dozens of new employees to bolster its fight against cryptocurrency fraud.
Why You Should Care
Offering Bitcoin-backed loans is part of Goldman Sachs’ strategy to contribute more to crypto adoption.
