Genesis Global Trading Inc., an established institutional market maker for virtual currencies, has opened up a lending business.
Genesis Global Capital, the new subsidiary, will be granting loans in the form of digital currencies to investors and institutions amounting to $100,000 or more. The lending service is set to offer loans in fixed terms ranging from two weeks to six months. Loan grants will be handed out in Bitcoin, Ether, Ether Classic, XRP, Bitcoin Cash, Zcash, and others.
In a press release, Genesis Capital stated:
“We believe now is a great time to offer an institutional-focused lending service because it will increase general liquidity in the marketplace, encourage new financial institutions to participate in a two-sided market and increase the working capital that companies use to scale their digital currency-centric businesses.”
The company advised that the lending capacity can be used to “hedge total portfolio risk or take speculative short positions,” but it also foresees that the service may also prove useful for other situations.
Genesis, in the statement, explained that one good example could be for remittance companies that “need to make immediate settlements to their customers, but don’t want to buy a large balance of bitcoin and hold that risk on their books.”
Garrett See, DV Chain CEO told CNBC:
“The majority of trading volume in several cryptocurrencies is denominated in bitcoin, which has created a need for a bitcoin lending market.”
Genesis’ focus on cryptocurrency lending is the latest institutional services to be added unto the market that has also witnessed the introduction of Bitcoin futures trading and intensified interest in Bitcoin exchange-traded funds.