Fidelity Digital Assets will soon be the companion with Silvergate Bank as it is another lender for cryptocurrency - backed loans. With Fidelity as their cryptocurrency custodian, Silvergate Bank will be the second lender to propose bitcoin-backed loans to investors. 

A bitcoin loan is a loan with bitcoin as security. This is accomplished by sending bitcoin to a multi-signature address. Subsequently, a bitcoin transaction is validated on the blockchain, amounts are sent to a client's bank account, and the loan's notice is charged monthly. 

This was in news several days that fidelity extends bitcoin-backed loans finished silver gate. 

As of June 2020, Silvergate has been offering loans supported by bitcoin and other cryptocurrencies through its Silvergate Exchange Network (SEN). 

Institutional investors who presently store their bitcoin with Fidelity Digital Assets can now contact SEN Leverage through this initiative. 

After associating with crypto lender BlockFi, Fidelity began accommodating bitcoin as collateral for cash loans in December. 

Similar Silvergate, we identify the opportunity to generate a more seamless investor experience by serving institutions maximize capital competence, as well as the opportunity to support the digital assets ecosystem through greater incorporation and collaborations like this, Christine Sandler, head of sales and marketing at Fidelity Digital Assets, mentioned in a press release. 

Investors observing to maintain their extended bitcoin positions, for instance, can use their bitcoin as collateral without the requirement to change custody workers or alter their position, Silvergate said in its announcement. 

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Silvergate proclaimed Coinbase custody as an earner of Bitcoin collateralized US Dollar loans last week. 

Bitcoin trades have been hammering on the SEC's door for years in the expectations of launching a Bitcoin ETF, only to be met with a firm no. The huge Fidelity Investments is now one of the companies hitting on the door, and that's probable to be a game-changer.

Source - 

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