Coinbase Capitalizes On Institutional Lending Gap Left By BlockFi, Genesis

Coinbase Global Inc. COIN has unveiled a new cryptocurrency lending service for U.S. institutional investors, aiming to step in where companies like BlockFi Inc. and Genesis Global stumbled.

In this fast-changing crypto landscape, such pivotal moves are reshaping digital assets. To stay ahead, mark your calendar for Benzinga's Future of Digital Assets conference on Nov. 14 in NYC, an electrifying event packed with industry insights you won't want to miss

Coinbase's Prime platform reported an impressive $57 million investment in this lending venture, as disclosed in a recent submission to the U.S. Securities and Exchange Commission. Coinbase Prime, designed as a holistic prime brokerage solution, facilitates institutions in both trading and asset custody.

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The premier U.S. crypto exchange's Tuesday announcement highlighted, “Institutions now have the option to lend their digital assets to Coinbase with uniform conditions, in a product that aligns with a Regulation D exemption.”

The company isn't new to the lending sector. Earlier in May, they halted new loans via their "Coinbase Borrow" service, which catered to individual investors by allowing them to secure loans against Bitcoin. This institutional-focused service operates under the same banner, termed Coinbase Credit.

However, past endeavors saw challenges. In June, the SEC accused Coinbase of unauthorized securities offerings related to its staking service, prompting several states to demand a halt to Coinbase's staking activities.

The past year witnessed major crypto lenders like Celsius Network CEL/USD, BlockFi, and Genesis Global navigating bankruptcy waters.

Their high-risk ventures didn't pan out, leading to a series of setbacks that curtailed investors' borrowing and leveraging options.

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