U.S. firm Genesis says it loaned more than $1.5 billion in cryptocurrency

[alyssa85]

https://www.reuters.com/article/us-crypto-currencies-genesis/u-s-firm-genesis-says-it-loaned-more-than-1-5-billion-in-cryptocurrency-idUSKCN1S11O3

Cryptocurrency dealer Genesis Global Trading said on Thursday it loaned digital assets valued at $1.53 billion to institutional borrowers in the year since it launched its lending business in March 2018, an indication of demand for the emerging lending market for cryptocurrencies.

Institutional borrowers such as hedge funds and other financial firms have used crypto assets to short digital currencies, hedge investments or finance business operations.

Genesis’ total loans reached $425 million in the first quarter, up 15 percent from the end of 2018, the company said.

New York-based Genesis, one of the largest OTC cryptocurrency brokerages, said it had $183 million in active loans at the end of the first quarter denominated in bitcoin, ether, XRP (Ripple coin), bitcoin cash and other coins.

If bitcoin's price continues to rise to it's all time high, they're going to make a mint from institutions who are borrowing in order to short.

[Genemind]

It only means that bitcoin is reaching even the largest market where the largest cryptocurrency brokers are. Institutional borrowers are holding and investing more cryptocurrency to secure their finances through lending when the market hit
the bull run again.

[Haunebu]

That is a risky gamble since no one can accurately speculate as to how the BTC value will move at any point of time, but I am expecting them to earn huge profits thanks to the halvening event in 2020.

It could also lead to them losing it all though I don't think this will happen.

[Beerwizzard]

Please name all those hedge funds that borrowed money in crypto. That seems to be one of the most retarded things they've ever done. If you work somewhere in USA or EU then it is much easier to take a usual bank loan with 0-3% instead of borrowing cryptocurrencies that may easily increase their value by 5% in a single day (despite the interest, earned by genesis).

[Jating]

And since the loaned started around 2018 or during the start of the bear market, I'm sure that those who borrowed is just holding it right now because if they sell, then they have lost so much and it's going hard for them to recover and then pay that loan.

It's a calculated risk, but they have to pay the price and it's a lessons for them, bad timing = big lost.

[LeGaulois]

https://www.reuters.com/article/us-crypto-currencies-genesis/u-s-firm-genesis-says-it-loaned-more-than-1-5-billion-in-cryptocurrency-idUSKCN1S11O3

Cryptocurrency dealer Genesis Global Trading said on Thursday it loaned digital assets valued at $1.53 billion to institutional borrowers in the year since it launched its lending business in March 2018, an indication of demand for the emerging lending market for cryptocurrencies.

Institutional borrowers such as hedge funds and other financial firms have used crypto assets to short digital currencies, hedge investments or finance business operations.

Genesis’ total loans reached $425 million in the first quarter, up 15 percent from the end of 2018, the company said.

New York-based Genesis, one of the largest OTC cryptocurrency brokerages, said it had $183 million in active loans at the end of the first quarter denominated in bitcoin, ether, XRP (Ripple coin), bitcoin cash and other coins.

If bitcoin's price continues to rise to it's all time high, they're going to make a mint from institutions who are borrowing in order to short.

"IF" makes all the difference here, as @Haunebu pointed out it's a high-risk model since it all depends on potential value. They must be truly confidence for the future.

@Haunebu
Halving may or may not pump Bitcoin. And in case, it pumps like we're thinking, it may bring BTC to what? only $8k-$10k? Still far from its ATH.

[figmentofmyass]

https://www.reuters.com/article/us-crypto-currencies-genesis/u-s-firm-genesis-says-it-loaned-more-than-1-5-billion-in-cryptocurrency-idUSKCN1S11O3

Cryptocurrency dealer Genesis Global Trading said on Thursday it loaned digital assets valued at $1.53 billion to institutional borrowers in the year since it launched its lending business in March 2018, an indication of demand for the emerging lending market for cryptocurrencies.

Institutional borrowers such as hedge funds and other financial firms have used crypto assets to short digital currencies, hedge investments or finance business operations.

Genesis’ total loans reached $425 million in the first quarter, up 15 percent from the end of 2018, the company said.

New York-based Genesis, one of the largest OTC cryptocurrency brokerages, said it had $183 million in active loans at the end of the first quarter denominated in bitcoin, ether, XRP (Ripple coin), bitcoin cash and other coins.

If bitcoin's price continues to rise to it's all time high, they're going to make a mint from institutions who are borrowing in order to short.

interesting find. at least this indicates the market has been heavily short since early last year. that represents strong buying pressure now that we're more than a year out from the top and the market has already fallen 85% from the ATH. shorters eventually need to buy back to cover their shorts and take profit.

i wish we could get live stats on this stuff. like the metrics we have for bitfinex shorts vs longs. because once supply or demand peaks/bottoms on the OTC market, that pressure inevitably starts spilling over into the spot exchange market.

[r1s2g3]

Please name all those hedge funds that borrowed money in crypto. That seems to be one of the most retarded things they've ever done. If you work somewhere in USA or EU then it is much easier to take a usual bank loan with 0-3% instead of borrowing cryptocurrencies that may easily increase their value by 5% in a single day (despite the interest, earned by genesis).

Not only for that all those hedge funds , it is retarded thing for genesis also to give long term crypto loans. If price at the end is somewhat at very high level then the loan is surely going to be defaulted and causing loss to both the business involved.

[hugeblack]

Institutional borrowers such as hedge funds and other financial firms have used crypto assets to short digital currencies, hedge investments or finance business operations.

When we talk about "Institutional borrowers", do you mean about real lending of cryptos "on-chain payment" or just a trusted party that sells unreal currencies "something like I send you 10 BTC to trade on another site"?
I do not expect this sale to be real, that's more than thousands of Bitcoins.
It is good to see some interest in cryptos even if they are in lending.

[sheenshane]

It only says that the bitcoin or all the cryptocurrency industry is starting to make it. Maybe these people already understood the algorithm of bitcoin from the time it will rise and the time it will go low. And these borrowers are actually waiting for the next bull run for them to get their loan paid. However, because of New York's statement about the Tether, seems like all of these people are messed up.

[crzy]

It only means that bitcoin is reaching even the largest market where the largest cryptocurrency brokers are. Institutional borrowers are holding and investing more cryptocurrency to secure their finances through lending when the market hit
the bull run again.

Yes, they knew already that cryptocurrency will be big in the future and having a loan thru cryptocurrency is something rare and if you don’t support this one, why to get a loan from this market. A bigger institution are preparing for a big day, we should also prepare for this.

[Yakamoto]

https://www.reuters.com/article/us-crypto-currencies-genesis/u-s-firm-genesis-says-it-loaned-more-than-1-5-billion-in-cryptocurrency-idUSKCN1S11O3

Cryptocurrency dealer Genesis Global Trading said on Thursday it loaned digital assets valued at $1.53 billion to institutional borrowers in the year since it launched its lending business in March 2018, an indication of demand for the emerging lending market for cryptocurrencies.

Institutional borrowers such as hedge funds and other financial firms have used crypto assets to short digital currencies, hedge investments or finance business operations.

Genesis’ total loans reached $425 million in the first quarter, up 15 percent from the end of 2018, the company said.

New York-based Genesis, one of the largest OTC cryptocurrency brokerages, said it had $183 million in active loans at the end of the first quarter denominated in bitcoin, ether, XRP (Ripple coin), bitcoin cash and other coins.

If bitcoin's price continues to rise to it's all time high, they're going to make a mint from institutions who are borrowing in order to short.

I didn't realize that there were companies which had significant investments in cryptos and offered them as loans to other large investors groups. The fact that there's $1.5 billion in investment and loan opportunities in cryptos is surprising though, as I certainly wasn't expecting there to be a securities market that large. At least this makes it somewhat obvious that a large portion of big-named cryptos (in the sense of $ values) are owned by companies that have a vested interest in their success.

I don't know what they're loaning the crypto out for, though. I would assume that a majority of it is directed towards securities positions, such as shorts and futures, but there's a lot of different things that could potentially be considered for loans in cryptos. I don't know what their business plan is, but considering the number of assets they have and their high $ values, it's working for them.

[dothebeats]

Someone must've done poor maths or poor organizational decisions in here, but if they are profiting off of that loan then so be it. OTC market has been booming for bitcoin and crypto anyway so perhaps they already are gaining a lot from the said deal. I'm interested to know or find out whether they can keep this up for the coming years or whether that loan will continue to be a liability for the company with profits diminishing.

Should they went the route of normal bank loans and deal with crypto, the burden of volatility won't be on their hands. But then again, no one knows what terms have they agreed to.

[Cuk0ng_bitc0in]

in my opinion, loans are a good way to get profits, especially in the world of commerce.

bullish will provide benefits, but, sometimes we must always see and control market volatility. and that is not easy.

[okala]

And since the loaned started around 2018 or during the start of the bear market, I'm sure that those who borrowed is just holding it right now because if they sell, then they have lost so much and it's going hard for them to recover and then pay that loan.

It's a calculated risk, but they have to pay the price and it's a lessons for them, bad timing = big lost.

Well they said loan in crypto asset which is my understanding can come in different forms such as load on establishing a virtual business or any other blockchain base projects such as establishment of an exchange and the rest. I quite agree with you on the point of them holding the fun since the loan was acquired in the 2018 bear market era but that will not stop the interest from reading.

[betty11]

That is a massive fund. The hedge funds will quickly make profit from cryptocurrency volatility. Hope these guys are not the ones quickly shorting the bitcoin when it rises, wherein we quickly see an offload of about $10B from the market and sometimes we see a quick massive fund inflow. This is something to glory about, it shows how promising and big this market is going to be.

[traderethereum]

in my opinion, loans are a good way to get profits, especially in the world of commerce.

bullish will provide benefits, but, sometimes we must always see and control market volatility. and that is not easy.

Loans can be a good way for some people who lend their money, but for the borrower, I don't think that is a good way because they need to repay the loan at the right time.
We know that many people trying to borrow some money from other people but some of them having difficulties in paying the loan.

[Yakamoto]

in my opinion, loans are a good way to get profits, especially in the world of commerce.

bullish will provide benefits, but, sometimes we must always see and control market volatility. and that is not easy.

Loans can be a good way for some people who lend their money, but for the borrower, I don't think that is a good way because they need to repay the loan at the right time.
We know that many people trying to borrow some money from other people but some of them having difficulties in paying the loan.

If you can make loans that have a good set of collateral behind it, you're going to mitigate a ton of the risk that comes with loans. Especially if you can physically take that collateral provided and keep it in your possession until the loan is paid back. Even if they default on the loan, you have something that you own which you can sell to recover the loss, or maybe make a small profit if the collateral is valued enough. Loans can be very profitable, you just need to know what you're doing.

Loans are also how the fiat economy grows, as a side note. Debt is literally what makes it tick. Bitcoin could run into the same situation if there was a sudden flux of outgoing loans, where there's less Bitcoin in the network than what needs to be paid back between interest and the principal.

[Thermytee]

For that amount to be loaned in crypto assets, then there must be something they've seen that a lot of institutions are yet to see. I see the use of crypto by large corporations, Banks and institutions as a major way for BTC to hut another Àth.