Silicon Valley Bank: Bitcoin lending is entering a new institutional era

CoinFeed, June 30 — According to CoinDesk, Silicon Valley Bank released a report stating that Bitcoin lending has entered a new institutional era after the 2022 crypto credit crisis, with stronger risk controls, increased institutional participation, and declining borrowing costs. Bitcoin is being seen as a collateral asset with instant global liquidity, fast settlement, and fungibility. Currently, several major U.S. banks have already provided Bitcoin-backed credit services, and the total crypto-backed loans increased by 49% year-on-year to $67 billion. Bitcoin lending platform Ledn estimates the current consumer BTC-backed loan market at about $3 billion, which could expand to $1 trillion in the next decade. The report points out that the collapses of Celsius, BlockFi, and Genesis from 2022 to 2023 exposed problems such as maturity mismatch and excessive leverage, and conservative underwriting and transparent risk management have become the foundation of the industry. Current Bitcoin-backed loan interest rates range from 7.5% to 16%, and Silicon Valley Bank expects bank and private credit fund participation to gradually narrow spreads.