Coinbase to Dissolve its Lending Product, Customers Have Four Months to Repay Loans

Coinbase has today confirmed plans to permanently wind down its lending product for retail customers, Coinbase Borrow, in coming months. In a previous May communication, the exchange said it would no longer provide new loans while active ones would remain so until their maturity as part of changes following a re-evaluation of its products.

Thursday reports convey that Coinbase now wants to conclude the Borrow program, which allowed retail users to obtain fiat loans using Bitcoin held by them (as much as 30% of their holdings) for collateral. While active, the lending offering facilitated the BTC-backed loans for sums of up to $1 million. The exchange extended a four-month repayment window (until Nov. 20) for loan holders to settle their outstanding figures, after which the customers’ collateral will be automatically sold to clear the same.

Coinbase has been the subject of intense scrutiny by the US Securities and Exchange Commission (SEC) in recent months. The securities regulator charged the exchange for “operating its crypto asset trading platform as an unregistered national securities exchange, broker, and clearing agency” early last month.Top of FormBottom of Form

Markedly, the lending program’s breakoff will neither affect Coinbase Prime nor the institutional customers. The California-based exchange noted that going forward, it plans to shift its focus towards offerings that meet its user base’s demands.