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Blockchain launched a lending outfit some months back, and it’s on track to surpass the growth metrics of its competitors and titans in the industry. The efforts of leading cryptocurrency wallet provider and data analysis company Blockchain to diversify its services have been yielding some fruit, as the company’s loan services seem to be taking off quite nicely.
According to a November 14 report, Blockchain’s loan desk, which has been operating pretty lowkey for a while now, is steady on track to hit $120 million in loans, posing credible competition to leading loan providers such as BlockFi and Genesis Global.
"Crypto is an entirely new financial system, one that requires a new approach to the long established world of lending"
— Blockchain (@blockchain) November 15, 2019
Citing a statement from the company chief executive Peter Smith, The Block reported that although the company began offering loans on a “case-by-case basis,” the demand for the loans has continued to surge, as the company seems to be shrugging off concerns over spikes in credits across the cryptocurrency industry to continue riding the lending wave.
More Loans, No Credit Worries
The concerns over credits were first raised by several experts on Wall Street, who expressed their views to Bloomberg last month that the crypto lending market, which grew to an estimated $6 billion valuation in less than 2 years, is headed for a significant bust.
However, Smith seems generally unbothered by the prospect of a bust-up, as he pointed out to The Block that the company’s “loan desk is so heavily collateralized a Lehman moment (a reference to the failure of investment banking giant Lehman Brothers Holdings as part of the 2008 financial crisis) would be impossible.”
— Alex Jiménez (@RAlexJimenez) October 13, 2019
Since each loan deal has been customized to each client, the company is of the belief that there are less risks, especially when compared to those of other lending platforms in the crypto space.
Blockfi Diversifies for Institutional Customers
Blockchain isn’t the only operator in the lending industry to be testing its feet in new waters. On October 18, BlockFi also announced that it would be opening BlockFi Institutional Services, a subsidiary that will expose institutional investors to digital asset financing solutions and the integration of digital assets into their operations.
Per the release, the service will also provide institutional investors with several cryptocurrencies, which they will use in conducting their trading operations and hedging their investment positions. The company commented that t has been seeing a surge in institutional activity on its platform, and with this new division, it hopes to serve them even better
Zac Prince, the company’s founder and chief executive, commented that BlockFi Institutional Services would provide users with sufficient leverage and flexibility with their digital assets, thus helping them to conduct the same investment activities that they can with traditional financial assets.
“Financial institutions are the natural next step as they move huge amounts of capital every day. We’re already seeing these institutions becoming more comfortable with digital currencies, and our products will further incentivize them to do so,” he said.