The attacker labeled his Bitcoin as collateral to obtain loot in cash. The attack is the latest sign of Wall Street’s focus on digital currencies. Cryptocurrency-backed loans are now a bitter reality on Wall Street.
United States banking giant Goldman Sachs took another step in accepting digital assets after bringing a first loan supported by Bitcoin (BTC). According to Bloomberg and its recent report, the giant bank brought US dollars in cash to a borrower in exchange for Bitcoin as collateral. The funds in digital assets were under the client’s control.
The new crypto lending feature seems to be part of a line of credit item activated by the consolidated financial entity. A Goldman representative gave vital information to CoinDesk about the service by highlighting that it recently expanded a secured line of credit where it lends fiat collateralized with BTC.
Wall Street Explores Crypto-Lending
While details about the new service are still few, the move arrives within Goldman’s most recent focus on consolidating its presence in the crypto environment. Recently, the bank has made many efforts to expand its offering of products connected to the new asset class.
The institution was the first big US entity to achieve an over-the-counter crypto sale. Specifically, Goldman carried out a trading operation with a Bitcoin-linked tool named a ‘non-deliverable option.’ The bank has already highlighted that it intends to set an expansion on its OTC offering to Ethereum.
This week, an important representative of Goldman, Mathew McDermott, revealed that the financial entity is exploring non-fungible tokens (NFTs) in financial instruments to achieve the “tokenization of real assets.”
The decisions show that Wall Street is increasingly taking new steps toward digital assets and the digital market. Investment bank Cowen built a digital asset unit in March; The world’s most prominent asset manager, BlackRock, recently played a vital role in the $400 million funding round for Circle, the creator of the USDC stable coin.
These names are just a simple demonstration. Other popular banking institutions like Morgan Stanley and JPMorgan have also immersed themselves in the crypto environment’s wide ocean, bringing Bitcoin exposure to their high-net-worth customers.
Goldman seems eager to secure its footing amid growing competition from financial entities to enter the burgeoning market. In addition to its diverse methods and its digital asset division, the bank recognized that it intends to bring a full spectrum of digital asset investments, which could even add a spot for Bitcoin.
News of Goldman’s first bitcoin-backed loan comes just months after a CoinDesk research teased that at least a dozen central US banks are going into digital currencies as collateral for loans. The giant bank Goldman Sachs was one of those highlighted in that research.
By: Jenson Nuñez
