Galaxy Digital cryptocurrency trading bank, founded by billionaire Mike Novogratz, is investing in a startup DrawBridge Lending specializing in lending backed by digital currencies.
– DrawBridge Borrowing (@DrawBridgeLend) August 8, 2019
And so, DrawBridge Loans gives fast fiat loans only to accredited investors for the security of digital assets, the safekeeping of which is done by a qualified third-party custodian for the repayment period. At the same time, all cryptocurrencies in cold storage are secured.
The drawback of DrawBridge loans is the lack of margin calls: if the value of the cryptocurrencies in collateral drops sharply, the borrower is not required to deposit more digital assets to maintain the property. Startup takes this risk on itself.
Note that DrawBridge Loan activities are regulated by the United States Derivatives Commission (CFTC), where the company is registered as a commodity trading advisor and commodity pool operator.
It is worth adding that Galaxy Digital is not the first to invest in such products. Last year, cryptocurrency invested $ 52.5 million in the launch of BlockFi, and then participated in two more rounds of financing for it – $ 4 million (led by Akuna Capital) and $ 18.3 million (led by Valar Ventures).
Meanwhile, another startup in the fast-growing cryptocurrency industry, Dharma Labs, which at one time raised $ 7 million from Green Visor Capital, Coinbase Ventures and Polychain Capital, recently announced the suspension of deposits and loans, promising to tell more about the development your later.
2 / We are currently suspending new deposits and loans in Dharma. If you have an existing deposit or loan in Dharma, you will still have access to your account and be able to withdraw any funds that are not currently locked.
– Dharma (@Dharma_HQ) August 7, 2019
The company is known to launch the Instant Match product at the end of June, which allows users to receive deposit dividends, but after a month, service support was discontinued, promising to share exciting news soon.
According to LoanScan, at least mid-July, the loans stopped being issued through the Dharma protocol.
In addition, Dharma developers also encountered a front-end error that prevented users from downloading funds. Thus, despite the boom in lending in the cryptocurrency industry, the future of this project seems pretty unclear.
This was a front-end software bug in our application
– Dharma (@Dharma_HQ) August 1, 2019
Subscribe to Forklog Facebook News!
Found an error in the text? Highlight it and press CTRL + ENTER
Subscribe for NEWS Forklog