Coinbase allows customers to loan up to $1 million using Bitcoin as collateral

Coinbase, a Nasdaq-listed cryptocurrency exchange, is now allowing customers to borrow up to $1 million using bitcoin as collateral. The company charges an interest rate of 8%, but there is no credit check. The bitcoin used as collateral “remains safely held by Coinbase,” according to the exchange, emphasizing that “it is not lent out or used for any other purpose.”

Cryptocurrency exchange Coinbase said Tuesday:

We’re excited to announce that eligible customers can now borrow up to $1 million USD from Coinbase.

The Nasdaq-listed crypto exchange said on its website that qualifying clients may “Borrow cash using bitcoin as collateral,” adding that borrowers would “Pay just 8% APR with no credit check.”

Customers may borrow up to 40% of the value of their bitcoin in their account, up to $1 million, according to the company. “Every month, you simply need to pay the interest due ($10 minimum),” Coinbase said, noting that there are no prepayment or late penalties.

“This line of credit has a demand feature and is repayable within 2 years of opening,” Coinbase said further, adding:

The bitcoin you use as collateral remains safely held by Coinbase. It’s not lent out or used for any other purpose.

Coinbase’s line of credit is presently accessible to residents of the following U.S. states: AK, AR, AZ, CA, FL, ID, IL, NC, NE, NH, NJ, NY, OH, OR, TN, TX, UT, VA, WA, and WY.

Coinbase recently abandoned its intention to start a lending program after the Securities and Exchange Commission (SEC) threatened to sue the business if it went forward with the launch. The exchange then presented a proposal for bitcoin regulation that included four key suggestions.