Leading U.S.-based cryptocurrency exchange, Coinbase, has made a big move to expand its crypto loan services following the launch of Ethereum-backed loans on Thursday, November 20.
Coinbase’s CEO, Brian Armstrong, has shared the update, highlighting the relevance of the launch for Ethereum holders on Coinbase.
Although the move has come amid the persisting market turmoil, it highlights growing resilience and confidence in the crypto market despite the fading momentum.
Apparently, the launch is expected to boost the practical use cases for Ethereum while driving its adoption, which could potentially fuel a major rebound for its price.
Ethereum-backed loans to kickstart in the US
According to the announcement, the launch will allow cryptocurrency users to borrow loans against their Ethereum holdings via the Coinbase exchange.
The launch, which is set to kickstart in the U.S., will allow Coinbase users in the U.S., excluding New York residents, to unlock liquidity from their long-term Ethereum holdings without having to sell their assets.
Notably, the launch will give users access to collect loans in USDC while using their Ethereum holdings as collateral. This way, they can borrow funds in the provided stablecoin while maintaining exposure to Ethereum.
Amid the growing demand for on-chain credit and collateralized borrowing, this development has sparked excitement across the crypto community, specifically among Coinbase users.
Impressively, the move tends to help Ethereum holders dodge liquidation or the risk of losing upside potential.
Although the crypto market may not currently be in its best position, the move further highlights Ethereum’s efficiency, particularly in on-chain lending, among other features like staking and restaking.
The development, which has gained hype among commentators, has fueled a bullish momentum across the crypto community considering its potential impact on Ethereum’s next price action.
With its design, the new product will see Coinbase bridging the gap between traditional finance and decentralized finance (DeFi), as it also stands as a way to provide users with more control over their digital wealth.