Genesis Trading has a new arm for cryptocurrencies lending. Don’t get too excited though. This service is only available for institutional investors and businesses.
For those who might not be aware, Genesis Trading is an institutional market maker. It is a division of SecondMarket Inc which is wholly owned by DCG group. DCG Group aims to inject liquidity into the digital currency market place.
It's no secret though. Genesis Trading continues to strategically place itself and plans to be a main cog in the cryptocurrency industry in years to come.
What is Liquidity?
By “bringing liquidity” I mean they often buy and sell large blocks of digital currencies in a secure platform. Just to give you some perspective. The company has moved more than 800,000 BTC since launch making it one of the largest Over the Counter trading desk in the world.
It’s the nature of their operations and that is why it has an operations license from the SEC as a dealer and broker of cryptocurrencies. This is a reprieve for skeptics. All Genesis Global Capital activities are under the microscope of US regulators including FINRA and SEC.
Genesis Global Capital
The new subsidiary, Genesis Global Capital will be a place where large scale investors and even businesses can borrow cryptocurrencies like BTC, ETH, BCH, ZCash, XRP and ETC worth more than $100,000. The holding period for these cryptocurrency loans will range from 2 weeks to up-to 6 months.
In a Press Release, Genesis Trading said that this move was out of necessity. Besides aiming to increase liquidity in the cryptocurrency market place, they want to avail working capital for businesses. Additionally, they want to back new financial institutions venturing into cryptocurrencies.
How Businesses will Benefit
They said businesses could use their lending capacity to hedge against portfolio risks and even take speculative short positions if need be. Genesis Trading gave prime examples as remittance companies and how they could take advantage of their services.
In their line of work for example, remittance companies should settle customer requirements on demand. However, they are often faced with a dilemma because often it’s not necessary for them to buy and hold large quantities of cryptocurrencies. Their volatile nature ships in some elements of risk which is are undesirable. This is where they may seek Genesis Trading lending services.