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Anchorage Provides ETH Backed Loans With One of America’s Oldest Banks


Anchorage Digital provides ETH-backed loans through a new partnership with BankProv, a nearly 200-year-old US bank

Anchorage Digital is providing ETH-backed loans through a new partnership with BankProv, a nearly 200-year-old US bank. Partnership, especially for institutions working with companies. Anchorage CEO Diogo Monica said the cryptocurrency lending space could accelerate towards supporting a wide variety of assets in addition to Bitcoin.

Digital asset bank Anchorage is developing its borrowing and lending tools and sees its new Ethereum-backed loans as a path to institutional growth.

The firm launched its latest loan product in partnership with BankProv, founded in 1828 (then known as The Provident Bank). Anchorage will continue to hold ETH as collateral while BankProv expands lines of credit denominated in USD and backed by ETH.

The structure of the lending product is not new. Anchorage offers BTC-backed loans in partnership with Silvergate digital asset bank. This partnership works the same way: Silvergate expands its line of credit in US dollars while Anchorage manages collateral. According to Anchorage CEO Diogo Monica, collateralizing with ETH opens new doors and the partnership with BankProv is targeting a diverse client base. In an interview with The Block earlier this year, Monica said that borrowing and lending is Anchorage’s fastest growing business and plans to expand through partnerships with other banks.

The nature of the lending product is not new – Anchorage offers BTC-backed loans in partnership with Silvergate digital asset bank. This partnership works the same way: Silvergate expands its line of credit in US dollars while Anchorage manages collateral.

But collateral in ETH opens new doors, and the partnership with BankProv is targeting a different client base, according to Anchorage CEO Diogo Monica. In an interview with The Block earlier this year, Monica said that borrowing and lending is Anchorage’s fastest growing business and plans to expand through partnerships with other banks. Collaboration with BankProv is one of the planned expansions and will target corporate customers in particular.

Shows Continuing Institutionalization of the Field

Institutions have started investing in Bitcoin, but are slower to adopt ETH and decentralized finance (DeFi) projects. According to Monica, it is the 10th oldest bank to offer ETH-backed loans in the US, a strong indication that the institutionalization of the space continues. Monica used the following statements:

“Silvergate has predominantly cryptocurrency clients. BankProv, on the other hand, has a broader set of traditional clients. So you can see it as another step towards crypto becoming mainstream.”

Monica said that as Bitcoin’s dominance wanes, institutions will feel the need to offer loans with all kinds of collateral.

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