TLDR
- Kraken introduced Flexline, offering fixed-rate loans backed by crypto for Kraken Pro members with interest rates spanning 10%–25%
- Borrowers can access terms between two days and two years, receiving funds in cryptocurrency or stablecoins
- Coinbase broadened its lending services, enabling US clients to borrow as much as $100,000 in USDC using collateral like XRP and Dogecoin
- Total value locked in DeFi lending platforms has reached $51.9 billion, with $30.8 billion currently borrowed
- In February, Apollo Global Management teamed up with Morpho to bolster blockchain lending infrastructure
Kraken has introduced a lending service named Flexline designed for its Pro platform users. This offering enables traders to obtain loans using their digital assets as collateral while maintaining ownership of their holdings.
The product features fixed interest rates ranging from 10% to 25% annually. Borrowers can select repayment periods spanning as short as two days or extending up to two years.
Loan proceeds are distributed in either cryptocurrency or stablecoins. Recipients may utilize these funds for platform trading or withdrawal, subject to geographic restrictions.
Kraken Pro serves as the exchange’s specialized platform targeting sophisticated and institutional market participants. The standard Kraken platform caters to novice users and retail investors.
Borrower collateral is maintained in isolated wallet structures. This collateral appears in Kraken’s Proof of Reserves reports, which authenticate client holdings on a one-to-one basis.
Should borrowers breach maintenance thresholds or allow loans to expire unpaid, Kraken reserves the right to liquidate pledged assets. While early loan repayment from account funds is permitted, the exchange applies an early settlement charge.
Specific loan-to-value parameters haven’t been publicly disclosed by Kraken. According to the exchange, approval processes complete almost immediately once users deposit eligible crypto collateral.
Flexline remains unavailable to residents of the United States, United Kingdom, Canada, Australia, Switzerland, UAE, Brazil, India, and New Zealand.
Coinbase Also Expands Crypto Lending
Flexline’s debut coincides with Coinbase broadening its collateral-based lending offerings. Qualified US customers can now secure up to $100,000 in USDC loans against holdings including XRP, Dogecoin, Cardano, and Litecoin.
US home lending institution Rate unveiled RateFi, a program enabling qualified applicants to leverage verified cryptocurrency portfolios toward underwriting criteria. The initiative permits digital assets to qualify as financial reserves and occasionally income without requiring asset sales.
DeFi Lending Continues to Grow
Decentralized finance lending platforms currently maintain roughly $51.9 billion in total value locked, based on DefiLlama data. Approximately $30.8 billion of this amount represents active loans.
Aave dominates the landscape with nearly $26.9 billion in TVL. Morpho protocol follows in second position with roughly $5.8 billion.
On February 15, Apollo Global Management, overseeing $940 billion in assets under management, established a partnership with Morpho to advance blockchain lending infrastructure. The arrangement includes potential acquisition of up to 90 million MORPHO tokens by Apollo.
Kraken’s Flexline introduction also follows the platform’s recent unveiling of tokenized equity perpetual futures on its regulated derivatives exchange. This product provides qualified international clients with round-the-clock leveraged access to US equity indexes, gold, and specific corporations including Apple, Nvidia, and Tesla.
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