Goldman Sachs Now Offers Bitcoin-Backed Loan

Goldman Sachs Now Offers Bitcoin-Backed Loan
  • Goldman Sachs grants cash collateralized by Bitcoin.
  • A spokeswoman said their structure and 24-hour risk management would make the deal more interesting.
  • The investment bank has been increasing its exposure to cryptocurrency since last year.

Wall Street giant Goldman Sachs, a leading global investment bank, has launched its first-ever loan backed by cryptocurrency. 

According to a report from Bloomberg on Thursday, Bitcoin owned by the borrowers can be used as collateral to avail of the loan. 

A spokeswoman for the bank disclosed in the report that the secured lending facility lent cash collateralized by borrowers who owned Bitcoin. Noting that the agreement was interesting to Goldman Sachs because of its structure and 24-hour risk management.

Recently, the investment bank has been increasing its exposure to cryptocurrency. Last March, the firm executed its first over-the-counter (OTC) crypto transaction. A few days later, Goldman Sachs’ homepage featured digitalization, including cryptocurrencies and metaverse. The company visualized the digital world as an $8 trillion opportunity. 

Last year, the company made moves to further expose itself to the crypto space. This includes bringing back its “Bitcoin trading desk” as the Crypto Market became more mature,  establishing a crypto trading team and launching Bitcoin derivatives trading, and expanding its crypto trading options to add Ethereum (ETH) futures and options.

In January, the wall street giant said that the price of Bitcoin (BTC) could reach $100,000. The bank’s analyst described:

“Bitcoin may have applications beyond simply a ‘store of value’ and digital asset markets are much bigger than bitcoin.”

Goldman Sachs wasn’t the first investment bank to offer Bitcoin-backed loans. In March, Silvergate Bank released a $205 million loan to Nasdaq-listed software company Microstrategy. The loan, collateralized by Microstrategy’s Bitcoin holdings, was used to buy additional Bitcoin for its company’s treasury

Tags:
disclaimer read more

Crypto News Land (cryptonewsland.com) , also abbreviated as “CNL”, is an independent media entity — we are not affiliated with any company in the blockchain and cryptocurrency industry. We aim to provide fresh and relevant content that will help build up the crypto space since we believe in its potential to impact the world for the better. All of our news sources are credible and accurate as we know it, although we do not make any warranty as to the validity of their statements as well as their motive behind it. While we make sure to double-check the veracity of information from our sources, we do not make any assurances as to the timeliness and completeness of any information in our website as provided by our sources. Moreover, we disclaim any information on our website as investment or financial advice. We encourage all visitors to do your own research and consult with an expert in the relevant subject before making any investment or trading decision.

Bryan is a gamer who became genuinely interested in crypto after his initial exposure to Play-to-Earn games like Axie Infinity and Pegaxy. He has basic knowledge of technical analysis and is keeping an eye out for interesting developments in the metaverse and GameFi space.