Coinbase launches crypto lending platform for US institutions
Cryptocurrency exchange Coinbase has rolled out a crypto lending service for institutional investors in the United States, reportedly aiming to capitalize on massive failures in the crypto lending market.
Coinbase has quietly launched an institutional-grade crypto lending platform, Coinbase Prime, to U.S. investors, according to a Bloomberg report on Sept. 5. Coinbase Prime is a full-service prime brokerage platform that lets institutions execute trades and custody assets.
“With this service, institutions can choose to lend digital assets to Coinbase under standardized terms in a product that qualifies for a Regulation D exemption,” the firm reportedly said in the statement.
According to a filing with the U.S. Securities and Exchange Commission, Coinbase customers have already invested $57 million in the lending program since the first sale occurred on Aug. 28. The offering had attracted five investors as of Sept. 1.
Coinbase did not immediately respond to Cointelegraph’s request for comment.
The new crypto lending product by Coinbase follows the halt of new loan issuance on Coinbase Borrow in May 2023. The program is designed to allow users to receive up to $1 million through Bitcoin (BTC) collateral. The new institutional program is operated through Coinbase Credit, the same entity that manages Coinbase Borrow.
Related: SEC vs. Coinbase: New lawyer Patrick Kennedy joins fight
The news comes months after the U.S. SEC charged Coinbase with alleged offering and sale of unregistered securities in connection with its crypto starking services, which allow users to earn yields on giving their crypto to the platform. The exchange opposed the SEC’s allegations, arguing that it strongly disagreed with any allegations that its staking services were securities.
Coinbase eventually had to pause its staking program in four states — California, New Jersey, South Carolina and Wisconsin — while the proceedings were going forward.
The crypto lending industry was hit with a massive crisis last year, with major companies like BlockFi, Celsius and Genesis Global going bankrupt amid a lack of liquidity caused by the bear market of 2022. Some crypto enthusiasts said that the crypto lending sector must learn lessons from the collapses and solve issues related to short-term assets and short-term liabilities.
Magazine: Magazine: How to protect your crypto in a volatile market — Bitcoin OGs and experts weigh in
Sam Bankman-Fried claimed that handing over FTX to its current CEO was the “single biggest mistake” that prevented him from saving the exchange.
The Conservative Party will leave a key human rights treaty if it wins the election, its leader Kemi Badenoch has said.
Ms Badenoch announced the policy to leave the European Convention on Human Rights (ECHR) ahead of the Conservative Party’s conference next week.
Despite many Tory MPs having expressed displeasure with the treaty, and the court that upholds treaty rights in recent years, it had not been party policy for the UK to exit it.
The move follows a review on the impact of the UK’s ECHR membership conducted by shadow attorney general Baron Wolfson.
Lord Wolfson’s nearly 200-page report said the ECHR had impacted government policy in numerous areas.
The report said this includes limiting government’s ability to address immigration issues, potentially hampering restrictions on climate change policy, and impacting government ability to prioritise British citizens for social housing and public services.
Read more:
Baroness Mone: I have no wish to rejoin Lords as Conservative peer
But leaving the ECHR would “not be a panacea to all the issues that have arisen in recent years”, Lord Wolfson said.
It comes after the Reform Party in August said they would take the UK out of the ECHR if elected.
The Conservatives have increasingly come under threat from Reform and are being trailed in the polls by them.
What is the ECHR?
The ECHR was established in the 1950s, drafted in the aftermath of the Second World War and the Holocaust, to protect people from serious human rights violations, with Sir Winston Churchill as a driving force.
It’s 18 sections guarantee rights such as the right to life, the prohibition of torture, the right to a fair trial, the right to private and family life and the right to freedom of expression.
It has been used to halt the deportation of migrants in 13 out of 29 UK cases since 1980.
Conservative Party leader Kemi Badenoch. Pic: PA
A political issue
Leaving the ECHR would breach the 1998 Good Friday Agreement, the peace settlement deal between the British and Irish governments on how Northern Ireland should be governed.
Labour has in recent days said it was considering how Article 3, the prohibition on torture, and Article 8,
the right to respect for private and family life, are interpreted. The sections have been used to halt deportation attempts.
The Liberal Democrats and Greens are in favour of the ECHR.
A general election is not expected until 2029.
Coinbase said seeking the license is part of its broader effort to bridge the gap between crypto and traditional finance.
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