Crypto Bank Anchorage Announces ETH-Backed Loans for Institutions

Institutional clients holding Ethereum can now access bank-grade loans, with custodied ETH providing collateral

Crypto custody and digital bank provider Anchorage Digital now offers an Ethereum-backed loan product for institutional investors. The digital asset bank will provide the lending service in partnership with BankProv, an FDIC-insured bank that currently ranks as the 10th oldest legacy bank in the US.

The crypto bank already provides collateralised loans for clients holding Bitcoin. But now institutional customers can borrow loans in USD on their Ethereum holdings, in a simple arrangement that allows clients to continue holding their crypto positions. To protect against defaults, the bank will hold the Ethereum as collateral.

This comes even as the crypto space continues to see an increase in demand for ETH loans, despite a recent weakness decimating price gains. Inflows into Ethereum jumped last week, with more likely given investors might view the price crash as a chance to buy the crypto at a bargain price.

According to Dave Mansfield, the CEO of BankProv, the partnership with Anchorage aligns with its “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 …”

Digital banks bringing people into crypto

In January, Anchorage received approval from the Office of the Comptroller of the Currency (OCC) to become the first federally chartered crypto bank. The charter allows Anchorage to provide custodial services to traditional banks seeking to offer crypto-related services.

On 25 February, Anchorage announced its Series C funding round had raised $80 million, with the funds earmarked for the expansion of its digital lending services. GIC, Singapore’s sovereign wealth fund, led the funding, with participation from Blockchain Capital, Lux, and Indico.

Elsewhere, UK-based digital bank Revolut has announced it will add more cryptocurrencies to its list of supported coins. The bank’s app already supports 21 tokens, with Polygon (MATIC), Cosmos (ATOM), and Chainlink (LINK) among the latest additions.

The post Crypto Bank Anchorage Announces ETH-Backed Loans for Institutions appeared first on Coin Journal.

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