Coinbase To Shut Down Borrow Program
Coinbase, America’s largest crypto exchange, is winding down its Borrow program and has given borrowers four months to repay their loans. The program allowed eligible customers to borrow up to $1 million in US dollars by using bitcoin or other cryptocurrencies as collateral.
Key Points:
– Coinbase Borrow program allowed customers to borrow cash without selling their crypto holdings.
– Current borrowers have four months to repay outstanding loan balances.
– Accounts with outstanding loans after November 20, 2023, will have their loans paid off by selling BTC collateral.
– The liquidation fee for borrowers unable to pay before the due date will be waived.
– Coinbase made the decision to shut down the program in order to focus on other products.
Why Is The Exchange Shutting Down The Program?
The closure of Coinbase Borrow was announced two months ago. The program was launched during the crypto bull run as a way to quickly access fiat loans without selling bitcoin. However, with the market now calmer, the program has not gained enough traction. Coinbase is shutting down the program to prioritize offerings that customers care about most and to focus on other products.
Regulatory issues may have also influenced the decision. Coinbase has faced scrutiny from US regulators, including a recent lawsuit from the SEC. The unclear regulations surrounding cryptocurrencies and related services may have contributed to the exchange’s decision.
Hot Take:
Coinbase’s decision to wind down its Borrow program reflects the changing dynamics of the crypto market and the need to prioritize customer-focused offerings. As regulatory uncertainties persist, exchanges like Coinbase may need to reassess their product offerings to align with evolving regulations and customer demands.