Anchorage, a popular digital bank, has just announced the launch of Ethereum-backed loans, according to an announcement shared by the company.
With the launch, the bank aims to expand its product offering while attracting new institutional clients.
As of now, the bank's customers have access to a USD credit line backed by the second largest cryptocurrency on the market thanks to a partnership with US commercial bank BankProv.
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This lending product works as follows: Anchorage holds the ETH and uses it as collateral should the customer fail to repay the USD loan. According to Anchorage, the larger the customer's ETH reserves, the larger the loans they will be able to access.
The bank already offers Bitcoin-backed loans, so the product itself is not new, the only novelty is the addition of a new asset as collateral.