Cryptocurrency exchange Coinbase turned out to be the first client of Goldman Sachs to take a bitcoin-backed loan, Bloomberg reports, citing sources close to the matter.
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Although further details about the loan remain unclear, Matthew Ballensweig, Managing Director and Co-Head of Trading and Lending at Genesis, told the media that borrowers usually post bitcoin (EXANTE: Bitcoin) at loan-to-value in the 40% to 60% range.
"Tenors can vary as well as other prepayment terms, but it's a simple structure to bring institutional lenders into the market."
Ballensweig added that with the deal, Goldman might be "testing the waters before making a bigger splash" as the financial institution is seeing a lot of demand for this type of transaction.
As iHodl reported, other crypto-focused banks, including Signature and Silvergate, are also offering similar bitcoin-backed loans. Earlier this year, Goldman Sachs started offering bitcoin and ether (ETH) futures and options trading to its clients. The bank also launched non-deliverable fiat-based BTC forwards.
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