Coinbase Crypto Exchange to Launch Bitcoin-Backed Loans to US Clients

Speaking about the new project in an emailed statement, Senior Director of Product Max Branzburg elaborated and said that the Bitcoin (BTC)-backed loans could be employed in various ways. Depending on a client’s financial needs, the BTC loans could be redirected towards large expenditures such as house payments, car repairs, weddings, and much more. It can also be used to help “manage higher-interest personal loans or credit card debt,” he added.  

The Bitcoin-backed product is only going to be available in 17 states for the time being, but Coinbase is working on license registration in other states and countries to expand its lending service.  On Wednesday, a waitlist opened, with the following headline: 

“Have you ever needed cash for something urgent, like a car or home repair? In the past, you might have sold Bitcoin to cover it and incurred a taxable gain or loss. Now you don't have to.” 

Coinbase exchange stated that it won’t reinvest the collateral elsewhere. Instead, its strategy is to keep the BTC at the exchange, which is a protocol that differs from what crypto lenders usually do – rehypothecate the collateral. 

The Future Looks Bright for Coinbase

Currently, Coinbase’s Bitcoin-backed loan is to be launched in these following states: Alaska, Arkansas, Connecticut, Florida, Georgia, Illinois, Massachusetts, New Hampshire, New Jersey, North Carolina, Oregon, Texas, Virginia, Nebraska, Utah, Wisconsin, and Wyoming. 

Coinbase has been making power moves this year. The San-Francisco coin exchange is planning to launch a stock market listing this year, which would make it the first major US cryptocurrency exchange to go public.