According to Seamus Rocc, general director of the private bank Xapo Bank Xapo Bank based at Gibraltarowy Bank Xapo Bank based at Gibraltarowy Bank Xapo Bank based at Gibraltarowy Bank Xapo Bank based at Gibraltar Bank Xapo Bank based at Gibraltar Bank Xapo Bank with headquarters in Gibraltar Gibraltarowy Bank Xapo Bank based in Bitcoins become more comfortable as they develop.
In an interview at the token2049 party in Dubai Rocca told CointeLgraph that with Bitcoin (BTC) floating about USD 95,000 and institutional adoption that begins to attach, the director said that the mood among investors moved from compact -term speculation to a more long -term perspective.
“I’m not sure if trust would be there three or four years ago,” said Rocca Cointelegraph. “But today people feel more comfortable to borrow against Bitcoin, because we are not close to levels that would cause liquidation.”
On March 18, XAPO Bank launched a loan product that allows users to borrow American dollars with their bitcoins as security. Thanks to the product, qualified customers can access $ 1 million loans while running BTC.
Loans supported by bitcoins are the “obvious” next step
Rocca told CointeLgraph that the growing trust in long -term cryptocurrency trajectory fueled the demand for the product. This was due to the development of a broader institutional reception.
“Expectations relate to institutional space, ETFS, and the music of mood on bitcoins is more about wider adoption and long -term thinking than very short -term speculation,” said Rocca.
He said that this change is the key to unlocking the demand for a BTC loan, because investors feel safer and feel that rapid drops in price are less likely.
CEO of XAPO Bank said that his loans supported by Bitcoin offer loan rates (LTV) of 20%, 30%and 40%, which gives the flexibility of borrowers during risk management. “If you receive a 20% LTV loan and you have 100 bitcoins, like many of the first users, they are still a few million dollars that you can borrow without the need for them,” said Rocca.
At a conservative LTV level, like 20%, Bitcoin must fall below USD 40,000 to make the borrower to get eliminated. “We are not nearly $ 40,000,” said Rocca Cointelegraph, pointing to the current price stability as a reason for the borrower’s trust.
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Borrowing helps investors avoid emergency sales
Rocca said that loans supported by Bitcoin are a solution for owners who want to remain exposed to BTC in the face of unexpected life expenses. “If you follow the investment ethos, an intelligent thing not to sell it in three days, if it is $ 100,000,” said Rocca.
“But life bothers,” Rocca added. CointeLgraph said that unexpected costs, such as medical accounts or exchange of a car, often force investors to liquidate assets in adverse times. Rocca said that instead of selling bitcoins for expenses of USD 10,000, investors can borrow in relation to their shares, while paying interest on the loan.
“You still have an increase in the recognition of bitcoin prices because you haven’t sold it,” he said. “But you get smoothness to pay for the things you need in everyday life.”
Thanks to the deepening of institutional adoption and the maturation of the Bitcoin market, the director of the bank XAPO betting that more long -term owners will be ready to take advantage of cryptographic liquidity without BTC sales. This means the transition from “hodlowa” culture to the age at which Bitcoin owners can do more with the resource.
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