Cointelegraph Team
Cointelegraph
Institutional investors can get USD on credit without liquidating their ETH.
Crypto custody bank Anchorage Digital is expanding its services into crypto-backed loans for institutional investors.
Clients at Anchorage can now access a line of USD credit backed by Ethereum through its partnership with U.S. commercial bank BankProv.
Anchorage Financing will introduce a simple way for investors to put their Ethereum holdings to work, enabling them to access USD to meet their needs without liquidating their holdings according to the announcement. The crypto custodian also offers staking services for additional yields on Ethereum
The digital asset bank holds on to the ETH, using it as collateral should a client be unable to repay the dollar loan. Clients with large ETH holdings will be able to access a larger line of credit. Anchorage already provides Bitcoin-backed loans through other capital providers.
Ethereum-backed loans may be under collateralized if the borrower passes appropriate risk due diligence checks according to Anchorage co-founder Diogo Mónica.
Dave Mansfield, CEO of BankProv, said that Anchorage’s collateral management tech is “world-class”, adding that it is a trusted partner to the banking industry:
We firmly believe in our mission and belief that the crypto market should be afforded the same access and rights to traditional financing tools as any other legal, well-capitalized and compliant business in America.
Anchorage was the first crypto firm to receive a charter from the U.S. national bank regulator in January 2021. BankProv is the tenth oldest bank in America, operating for over 200 years as The Provident Bank before a rebrand in 2020.
In late February, Anchorage raised $80 million in a Series C funding round led by GIC, Singapore’s sovereign wealth fund, with participation from Andreessen Horowitz, and Blockchain Capital. The funding helped the custodian to assist institutions by bringing crypto to their users and diversifying their corporate treasuries.
In late March, Anchorage teamed up with cryptocurrency trading platform Prometheum to launch a fully regulated alternative trading system, or ATS, tailed specifically for professional crypto investors.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.
Recommended Content
Editors’ Picks
Ethereum continues hinting at rally following reduced long liquidations
Ethereum has continued showing signs of a potential rally on Tuesday as most coins in the crypto market are also posting gains. This comes amid speculation of a potential decline following FTX ETH sales and normalizing ETH risk reversals.
HBAR price jumps 75% as BlackRock tokenizes Money Market Fund on Hedera
Archax, Ownera and The HBAR Foundation have enabled the first tokenization of BlackRock’s money market fund (MMF) on Hedera. Last year Hedera Council member abrdn’s successfully tokenized its MMFs on Hedera.
Bitcoin price holds above $66K as Morgan Stanley files prospectus to add BTC ETF exposure in two of its funds
Bitcoin (BTC) price remains range-bound, holding above the $63,000 level, while its upside is capped below $68,000, going against or delaying the assumption that the fourth halving would be a 'sell-the-news' outcome.
Crypto community reacts as BRICS considers launching stablecoin for international trade settlement
BRICS is intensifying efforts to reduce reliance on the US dollar after plans for a stablecoin effort surfaced online on Tuesday. Most people expect the stablecoin to be backed by gold, considering BRICS nations have been accumulating large holdings of the commodity.
Bitcoin: BTC post-halving rally could be partially priced in Premium
Bitcoin (BTC) price briefly slipped below the $60,000 level for the last three days, attracting buyers in this area as the fourth BTC halving is due in a few hours. Is the halving priced in for Bitcoin? Or will the pioneer crypto note more gains in the coming days?