Coinbase terminates its Bitcoin loan service, meets Ripple legal team to discuss crypto regulation
- Coinbase announced an end to its Bitcoin backed loans after mounting regulatory pressures on the exchange.
- Coinbase Borrow provided loans of as much as $1 million against BTC collateral in select US states; the service ends on May 10.
- The exchange’s Chief Legal Officer organized a meeting with Ripple’s counsel to discuss regulation in the crypto ecosystem.
The mounting regulatory pressures on crypto exchange Coinbase resulted in a termination of its Bitcoin loan service, Borrow. The exchange used to offer millions in loans against a Bitcoin collateral to users in several US states, prior to its termination.
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Coinbase ceases Borrow, Bitcoin-backed loans service effective May 10
Coinbase, one of the largest cryptocurrency exchanges in the crypto ecosystem, suffered mounting regulatory pressures from the US Securities and Exchange Commission. In the unfavorable legal environment, Coinbase announced a termination of its Bitcoin-backed loans service, effective May 10.
Coinbase Borrow, the service that allowed crypto traders across several US states to borrow capital against Bitcoin collateral will no longer be available. Based on data from research firm Apptopia that tracks app usage metrics, there is a decline in the number of people downloading the Coinbase App.
The firm has not issued clarification on the reason for the loan service termination, however experts have noted a spike in regulatory pressure since the US SEC issued a Wells Notice in March 2023.
Coinbase legal team met Ripple counsel for discussion
Stuart Alderoty, Chief Legal Officer at Ripple thanked Coinbase’s Legal Officer Paul Grewal for dropping by the payment giant’s legal team for a chat. The legal counsel of the crypto exchange and the cross-border payment remittance firm have several hot topics to discuss with Ripple’s ongoing legal battle with the SEC and the regulator’s approach to digital assets.
Thanks @iampaulgrewal -- really appreciate you taking the time to chat with Ripple's team legal at our offsite! https://t.co/FUqFl00IxA
— Stuart Alderoty (@s_alderoty) May 3, 2023
Neither Coinbase nor Ripple’s team disclosed the matter discussed in the meeting, while both hinted at future meetups in their tweets.
Author
Ekta Mourya
FXStreet
Ekta Mourya has extensive experience in fundamental and on-chain analysis, particularly focused on impact of macroeconomics and central bank policies on cryptocurrencies.
