(Bloomberg) -- Goldman Sachs Group Inc. offered its first ever lending facility backed by Bitcoin, in a significant step for a major U.S. bank that accelerates Wall Street's embrace of cryptocurrencies.
The secured lending facility lent cash collateralized by Bitcoin owned by the borrower, a spokeswoman for the bank said. The deal was interesting to Goldman because of its structure and 24-hour risk management, she said in an email.
Wall Street banks are ramping up their crypto offerings after a surge in price and popularity chipped away years of prior resistance. For Goldman, which traded its first over-the-counter Bitcoin options in March and has a digital-assets team, the step signals entry into a new business line that's currently the domain of firms more specialized in crypto.
Jefferies Financial Group Inc. is expanding banking services for crypto clients, while BlackRock Inc. joined a $400 million funding round in stablecoin firm Circle this month. Boutique investment bank Cowen Inc. started a digital assets unit in March.
Some of the crypto-related products and services already offered by Wall Street include wealth management, trading and investment banking. Lending to companies that provide virtual currencies as collateral is the next step, Damien Vanderwilt, co-president of Galaxy Digital Holdings, recently said.
Read More: Wall Street Firms Make Crypto Push to Catch Up With ‘Cool Kids'
So far, crypto-friendly banks including Silvergate Capital Corp. have already provided U.S. dollar loans backed by Bitcoin.
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