Coinbase, the digital currency exchange, will offer bitcoin-backed cash loans to select customers as early as next month, the San Francisco-based company announced on its blog this week.
Customers from 17 states have been asked to join the waiting list to borrow up to 30% of their bitcoin holdings. The maximum loan is $ 20,000 at 8% for one year with no credit check fast cash loans
âWith today’s announcement, we want to give our customers even more control over their crypto investments, while providing secure access to fast cash loans at the same time,â wrote Thorsten Jaeckel, Product Manager for Coinbase, on the blog.
Coinbase said it launched the service in response to customers who said they needed money for expenses such as home renovations or car repairs, but would rather not sell their cryptocurrency prematurely or take out high interest loans. .
Initially, loans are available in the following states via the waiting list: Alaska, Arkansas, Connecticut, Florida, Georgia, Illinois, Massachusetts, New Hampshire, New Jersey, North Carolina, Oregon, Texas, Virginia, Nebraska, Utah , Wisconsin and Wyoming.
The exchange, which has more than 35 million users worldwide, said it was working to secure licenses to add more cryptocurrencies as well as expand into jurisdictions.
Bitcoin.com announced that Coinbase will compete with Nexo and Blockfi.
Additionally, the website reported that Square’s Cash app, a crypto-friendly payment platform, is testing short-term loans between $ 20 and $ 200 at a fixed interest rate of 5% per month.
Liberty Street Economics, a research blog for the Federal Reserve Bank of New York, said in an article that the usual distinction between “token-based” and “account-based” cryptocurrencies is too simplistic because several coins popular digital devices, including bitcoin, could be both.
A token-based system, he said, means a system in which validation of the object used to pay is required, while an account-based system verifies the identity of the person paying.
Regular currency, according to the publication, is a traditional token-based system, where people pay for goods or services and all that is needed is knowing that the person has enough valid currency to make the payment.
In June, the New York State Department of Financial Services (DFS), which oversees 1,500 banks and financial institutions and more than 1,400 insurance companies, proposed a conditional licensing framework that promises to make the job easier. cryptocurrency startups.
Under the proposal, emerging companies participating in the program can apply for a conditional license from DFS if they partner with an existing company authorized by DFS to engage in virtual currency trading activity.