Digital currency prime brokerage Genesis said its new loan originations increased almost 700% year-over-year to an all-time high of USD 25bn in this year’s second quarter and were also 60% higher than in the first quarter this year. Also, bitcoin (BTC) is losing its share in their portfolio.
“This marked our thirteenth consecutive quarter of strong lending growth,” the firm said, adding that this also brings the cumulative originated value to USD 66bn since the launch of the Genesis lending business in March 2018.
The Q2 2021 Market Observations Report stated that, despite a 41% decline in the BTC price over Q2, the company’s total Active Loans Outstanding decreased by only 8% to USD 8.30bn.
Per the loan portfolio composition, BTC accounted for 42% at the end of the second quarter, compared with 54% at the end of 2020.
Q2 2021 loan portfolio composition
“Since our weighted average cost of capital (WACC) on crypto assets was significantly lower than our cost in USD, Genesis had more room to lend crypto at lower rates, even when spreads were much tighter,” the firm said.
Other highlights include:
- Genesis traded USD 29.2bn in spot in Q2;