Genesis Global Trading has confirmed that it does loan out digital assets to institutional borrowers, which includes hedge funds as well as other centralized financial institution. The over-the-counter cryptocurrency dealers have also made it known that the total of cryptos loaned out so far, stands at about half a billion dollars.

Genesis Global Trading To release Lending Report

Genesis Global Trading which is based in, New York USA, made it known that it plans on releasing a quarterly lending report. The firm also made it know that it started lending out cryptos in March 2018 and currently it has more than $130 million worth of loans awaiting collections. This loan is said to be distributed across all major crypto such as Bitcoin, Ether, XRP, Bitcoin Cash etc.

In a recent statement, Genesis Global Trading made it clear that the borrowing institutions are generally making use of the asset borrowed to short digital currencies, hedge investments of fund business operations.

Hedge funds are the Major Borrowers

The CEO of Genesis Michael Moro made it known that the firm is able to serve the bulk of financial institution loaning from them making use of what the firm borrows from other holders. This is an easy thing to do for Genesis, basically because the demand for the service initially outstripped supply.

Going by the recent report, the firm has made it know that it has so far loaned about $553 million to major financial institution across the world.

The report also made it known that the major firms requesting for loans are hedge funds and the bulk of their loans are usually paid to them in Ether. The hedge funds are said to be using the capital to short or bet the price of ETH will drop. However since ETH drop about 80 percent from its highs in March, this activity has subsided.

As a result of this price drop, Genesis Global Trading made it known that the Ether portion of its loan has reduced to just 4% and the bitcoin is not the favorite digital asset for most borrowers.

Genesis Global Trading CEO made it known that the firm pays between 5-7% for it to borrow the digital asset which it then loans out for 10-11%.