Coinbase took out the first Bitcoin-backed loan from Goldman Sachs

cointelegraph.com:

America’s largest crypto exchange Coinbase has been revealed as the mystery firm that took out Wall Street’s first Bitcoin-backed loan from Goldman Sachs.

Goldman Sachs has $2.5 trillion assets under management as of 2021.

Bloomberg reported on Tuesday that the Bitcoin-backed loan issued by Goldman had been taken out by Coinbase as a way to deepen ties between the crypto and tradfi world, with the head of Coinbase Institutional Brett Tejpaul stating that:

The dollar value of the loan has not been disclosed, but it was collateralized by a portion of Coinbase’s total holdings of 4,487 Bitcoin, worth around $170 million today. The loan features 24-hour risk management, but requires Coinbase to top up its BTC collateral if prices fall too low.

While Bitcoin-backed and other crypto-backed loans are commonplace in the crypto industry, especially on decentralized finance (DeFi) protocols, they are a curiosity in traditional finance where crypto is seen as too risky and volatile as collateral.

However, asset management firm Arca wrote in a May 2 blog post that potential borrowers are looking for more such options. It said, “[This loan] demonstrates the willingness of institutions to utilize new tools with old techniques.”

News of the Bitcoin-backed loan sparked commentary on Twitter. Regarding the loan, Bitcoin podcaster Preston Pysh tweeted Wednesday: “No wonder the SEC is hiring people.”

Meanwhile, Coinbase CEO Brian Armstrong, has laid out his vision for free speech being enabled through decentralized social media platforms. He told the Milken Institute on May 2 that under new owner Elon Musk, Twitter has an opportunity to “essentially embrace using a decentralized protocol” which the platform could operate on.

Armstrong believes a