cryptovibes.com
Fidelity Digital Assets is taking another sure to cryptocurrency adoption. The firm will now provide fiat loans to its customers against 60% of their Bitcoin holdings.
BlockFi partnership makes loans possible
The new crypto loans will be provided in partnership with the New York-based crypto wealth management platform BlockFi. Fidelity Digital Assets is the crypto arm of Fidelity Investments, one of the largest asset managers in the world. It only serves institutional investors like family offices, hedge funds, and market intermediaries.
Fidelity Digital Assets President Tom Jessop commented on the new service and said that it caters to Bitcoin investors who want to turn their digital holdings into cash without selling their assets. The firm will provide a 60% loan to value ration (LTV) which means that potential customers can get loans up to 60% of their holdings’ value. The firm is eyeing OTC trading desks, crypto miners, and hedge funds as possible customers for its new service.
Crypto loan demand grows
Several crypto platforms have started offering loans to their clients as a way to cash their holdings without selling their coins. BlockFi also launched its services in March 2019, providing loans to people interested in borrowing cryptocurrencies. The loan amount ranges from $2,000 to $1000 million and can be availed against stablecoins, Ethereum, and Bitcoin.
BlockFi claimed to be doubling in monthly revenues ever since its latest Series B funding round, which brought an additional $30 million in investments in February. The New York based crypto lender said that it is on track to generate about $100 million in revenue in the next year.
BlockFi has attracted more than $1.5 billion in deposits from institutional, retail, and corporate investors to date. The firm has also reported strong earnings growth and an increase in its client base. It is also looking at a bigger footprint in Asia. Fidelity, on the other hand, is already offering users a range of institutional-grade services, including custody that comes with 24×7 execution services.