Silvergate Capital Corporation, a provider of innovative financial infrastructure solutions to the digital currency industry, has appointed Coinbase Custody as a custodian for SEN Leverage.
Silver Exchange Network (SEN) Leverage provides secure, institutional-grade access to capital through US dollar loans collateralised by bitcoin.
Using SEN Leverage, institutional investors receive USD financing by entering into a loan agreement with Silvergate Bank, and Silvergate uses its payments network to fund loans.
The investor’s collateral such as bitcoin is held by Coinbase Custody in a segregated cold storage account, explains Silvergate.
Silvergate made SEN Leverage a full product offering in Q4 2020 and says the product continues to grow its contribution to the overall success of the Silvergate banking platform.
“Traditional lending services generally do not exist in the digital currency industry, which means there aren’t many lenders for investors to choose from,” says Jon Melton, director of digital asset lending at Silvergate.
Melton explains: “Our relationship with Coinbase Custody offers institutional investors increased access to capital efficiency so they can take advantage of market opportunities in the digital currency industry.”
Sam McIngvale, CEO of Coinbase Custody, comments: “As one of the global leaders in the custody of digital assets, we feel this is a relationship of equals and we’re happy to help Silvergate work toward their goal of maximising capital efficiency for this rapidly growing industry.”