Goldman Sachs Group lends money to Coinbase backed by bitcoins - page 2.

avikz

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Quote from: Hold-n-play on June 03, 2022, 06:50:55 AM

Goldman Sachs Group lends money to Coinbase backed by bitcoins bringing money from the Wall Street to the digital-asset space

https://www.bloomberg.com/news/articles/2022-05-03/coinbase-is-on-other-side-of-goldman-s-first-bitcoin-backed-loan?sref=fgHqaWRV

Trying to open up some discussion here - do you believe that this news is potentially good one for crypto and for Defi projects as well?

One centralized entity is investing in another centralized entity! What's the big deal here? Coinbase is a market listed company and if Goldman Sachs thinks that Coinbase will do great in future, they don't have any issue in investing there. It's all fine as both of this Goldman Sachs and Coinbase belong to the same league. One deals in fiat and another one deals in cryptos, but both are centralized in nature, like brothers! I frankly don't see any impact on the defi projects. neither good nor bad!

OgNasty

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Well, Coinbase did say they were going to hold their Bitcoin. I guess with the recent collapse of Luna and the altcoin market, Coinbase is in need of some funds (their stock price certainly indicates this). Rather than sell their BTC and crash the market further, they're taking a loan out against their BTC. This is pretty much the last resort before bankruptcy I feel like. I know I wouldn't be leaving any BTC on Coinbase right now... I locked some ETH into their 2.0 contract and now I'm concerned if I'll ever see that again. Coinbase has been around a long time, but it seems like their recent business decisions are playing with fire and risking insolvency.

Fortify

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Quote from: Hold-n-play on June 03, 2022, 06:50:55 AM

Goldman Sachs Group lends money to Coinbase backed by bitcoins bringing money from the Wall Street to the digital-asset space

https://www.bloomberg.com/news/articles/2022-05-03/coinbase-is-on-other-side-of-goldman-s-first-bitcoin-backed-loan?sref=fgHqaWRV

Trying to open up some discussion here - do you believe that this news is potentially good one for crypto and for Defi projects as well?

I am really surprised by how far the price of Coinbase has dropped since it was floated. It's nice to see that there are wall street giants who are coming in and understanding what a money making machine this sort of exchange can be. Like it or not, for widespread adoption of Bitcoin and other cryptocurrencies to happen it is going to require a few big exchanges where the average person can feel safe storing their "virtual tokens" over a long time period. Many have no interest in learning all the intricate details or holding their own private wallets like some here might advocate. On that note Coinbase rakes in a lot of fees and maybe need to reduce those, that is why they are looking like such an attractive investment target right now.

Husires

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Does anyone know the history of the borrowing? Determine whether it was before the interest rate hike and the bitcoin price drop, or before that? What does a loan paid in bitcoin mean?

If I want to borrow $30,000 and say I put Bitcoin as collateral, will lenders treat Bitcoin as an asset or because of its price? If the price drops to 10,000, I will be asked to put 2 additional bitcoins as collateral?

Fundamentals Of

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It is not just potentially good. It is good. It means that there is already a growing recognition of Bitcoin in Wall Street. If a bank as large as Goldman Sachs lends away millions in USD with Bitcoin as collateral, it means only one thing: that Bitcoin is valuable. You cannot use it as a collateral if the bank doesn't find it valuable. So this is really good. And since Goldman Sachs is now doing it, smaller banks will definitely be watching with focus and eventually do the same.

DaveF

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It will have 0 impact on De-Fi

As for what it will do in general, hard to say. It's looks like any other asset backed loan. So you get better interest rates since they have a hard asset to sell if you default.
Probably good for both companies. GS gets to make a low-ish risk loan and CB gets financing with better rates then the open market / bond sale type thing.

-Dave

mk4

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Sounds good in theory, but time will tell. It would show a great sign to the markets if bitcoin held decently throughout the duration; and on the other hand it would be catastrophic bad news if bitcoin ended up having a couple of long lightsaber-ish red candles, ending up having the BTC to be liquidated.

Hold-n-play

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Goldman Sachs Group lends money to Coinbase backed by bitcoins bringing money from the Wall Street to the digital-asset space

https://www.bloomberg.com/news/articles/2022-05-03/coinbase-is-on-other-side-of-goldman-s-first-bitcoin-backed-loan?sref=fgHqaWRV

Trying to open up some discussion here - do you believe that this news is potentially good one for crypto and for Defi projects as well?

Topic: Goldman Sachs Group lends money to Coinbase backed by bitcoins - page 2. (Read 310 times)