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- Coinbase users can borrow 40% of their BTC holdings on the platform
- The exchange only lend upto $1 million to all of its users without credit checks
- Users will receive the borrowed funds through PayPal or bank accounts
- Coinbase charges an APR of 8%, and the users require to pay a minimum of $10 monthly as interest payments
Coinbase is one of the leading digital assets exchanges offering crypto-related services to its global audience. Moreover, the exchange platform is one of the first cryptocurrency start-ups that went public. Recently, the platform announced that it will lend cash via PayPal or bank accounts to its users. Indeed, the users of the digital assets firm can borrow Bitcoins without credit checks, as revealed by the firm’s recent tweet published on Tuesday. However, the clients can only borrow upto 40% of their holdings and not more than $1 million.
Coinbase will issue loans without credit checks
Coinbase, one of the earlier crypto assets start-ups, is lending Bitcoins. Users of the platform can now borrow about 40% of their current Bitcoin holdings upto $1 million. For lending the cryptocurrency firm asks for no credit checks. According to the latest tweet shared by the firm, the borrowing minimum and maximum amounts may vary by state.
Moreover, the digital assets platform issues loans with an annual percentage rate (APR) of 8% and the borrowers won’t be required to show their credit profile.
How will the exchange disburse Bitcoin loans?
According to the recent announcement, the clients of Coinbase can obtain their borrowed amount using their PayPal or bank accounts. However, it is significant to note that the users require to pay a minimum of $10 monthly as interest payments. Notably, the exchange platform is also offering flexible repayments schedules for the convenience of their users borrowing Bitcoin as collateral.
In the announcement, Coinbase has also underscored that the firm will not lend the collateralized coins that are designed by Satoshi Nakamoto. Instead, the firm has plans to continue hodling the digital assets.
Lending products will be powered by savings account
Earlier 2021, Coinbase had shared its plans to offer such leading financial instruments to its clients. However, the firm had to drop its plans, as the United States Securities and Exchange Commission (SEC) will raise concerns. Simultaneously, at the time only the exchange revealed that its lending products will be powered by cryptocurrency savings accounts. And such account holders would be able to earn a 4% annual percentage yield (APY). Notably, such return is something that multiples higher than most of the savings accounts at traditional banks.
