Swiss online bank Dukascopy has introduced a new lending product that enables customers to borrow against their cryptocurrency. The solution allows users to receive 50% of the value of their digital assets in fiat currency while retaining their original crypto investments.
Switzerland-Regulated Dukascopy Bank Launches Automated Crypto Lending Feature
Geneva-headquartered Dukascopy Bank is now offering clients an option to borrow cash in U.S. dollars while keeping their investments in cryptocurrency. Under the bank’s new lending program, they can receive a loan for 50% of the value of their crypto assets in fiat equivalent.
To take advantage of the feature, customers need to open a multi-currency bank account (MCA) and transfer the crypto they want to use. Then they can find the digital assets in the “Investments” section and select the “Crypto lending/borrowing” option. The bank said in a press release:
In your MCA account, you will find 50% of your investment market value in fiat.
Upon signing a “Trading Agreement,” users will also receive login credentials for a trading sub-account, in which they’ll find another 50% of the investment market value of their crypto in fiat as collateral as well as their crypto investment as an open position.
This means that if you send 0.1 bitcoin (BTC) to your MCA account, you would receive $1,405 and change (at the time of writing) on your bank account and the same amount of fiat on your trading account, according to the online calculator on the bank’s website.
Dukascopy would also open a long margin position of 0.1 BTC/USD on the trading sub-account. All these operations are automated, the Swiss financial institution noted, adding that a commission of 1% applies to the incoming crypto transfer.
The new offering of Dukascopy Bank, which is regulated by the Swiss Financial Market Supervisory Authority, comes in challenging times for the cryptocurrency industry as a whole and the crypto lending sector in particular, with increased regulatory pressures and high-profile bankruptcies such as those of Celsius and Voyager.