Crypto News: Coinbase Discontinues Borrow Program Amid SEC Investigation, Launches International Derivatives Exchange
Coinbase, the popular US-based cryptocurrency exchange, has announced that it will be discontinuing its Borrow program, which allowed users to borrow fiat loans using Bitcoin as collateral.
The program permitted users to borrow up to $1 million at an annual interest rate of 8.7%, against up to 40% of their Bitcoin holdings in some US states. According to an email sent to customers on May 3, the Borrow feature will no longer be available from May 10.
It is unclear how many users had used the Borrow program. Coinbase’s decision comes as the Securities and Exchange Commission (SEC) has raised concerns about the exchange’s offering and selling of unregistered securities.
The SEC is investigating other Coinbase services, including its spot market, staking service, Coinbase Prime, and Coinbase Wallet. However, Coinbase has stated that the discontinuation of the Borrow program is unrelated to the potential enforcement action.
Coinbase has launched a new international derivatives exchange for institutional players outside the US. The exchange is listing Bitcoin and Ether perpetual futures and settling all trades in USDC, without the need for any fiat on-ramps. In separate news, Coinbase will report its earnings results on May 4 after the market closes.
The exchange’s shares were last traded around $48 in Wednesday’s pre-market and are up by 32.8% in the year-to-date period, according to TradingView data.
To summarize, Coinbase has discontinued its Borrow program amid an investigation by the SEC over the exchange’s potential offering of unregistered securities.
Additionally, Coinbase has launched a new international derivatives exchange for institutional investors outside the US, listing Bitcoin and Ether perpetual futures. The exchange will report its earnings results on May 4.
