Unlocking Value: The New Borrowing Option
On September 14, Compound Treasury made a significant stride in the financial landscape by allowing accredited institutions to borrow USD or USDC at tantalizingly low fixed rates from 6% APR. What makes this enticing? Well, borrowers can plug in their Bitcoin (BTC), Ether (ETH), or other supported ERC-20 assets as collateral. Yep, you read that right! No more hiding your crypto assets under a digital mattress; now, you can actually do something constructive with them.
The Symptoms of a Volatile Market
Anyone who has stepped foot in the world of finance recently knows that it’s like riding a roller coaster—up, down, and hold on for dear life! The announcement from Compound Treasury arises amid this chaos, responding directly to the heightened demand for liquidity. Reid Cuming, the vice president of Compound Treasury, succinctly put it, “Compound Treasury can now address demand for liquidity with a simple, reliable borrowing solution.” Sounds too good to be true? It’s not!
Flexibility Like Never Before
With this new borrowing solution, institutions gain the freedom they didn’t know they needed. Imagine having an open-ended term with no repayment schedule, as long as you stay overcollateralized. You can borrow and manage your assets adequately without the constant nagging feeling of a ticking clock. Talk about pressure relief!
The Safety Net of Control
Now, here’s the kicker: the collateral that borrowing institutions put up isn’t going to vanish into thin air. It remains firmly under the control of Compound Treasury, fostering a sense of transparency and safety. As Reid Cuming emphasized, this mechanism enhances the security of their operations, providing clients with peace of mind while still tapping into liquidity.
Backing by Numbers: Trust in Assets
All this juicy lending action is made possible thanks to Compound Treasury itself, which boasts over $3 billion in assets and an impressive total transaction volume of more than $285 billion since inception. This isn’t just pie in the sky; there’s a solid infrastructure and trust built over time that backs this whole operation. And let’s not forget—the company even snagged a B- credit rating from S&P Global, becoming a pioneer by being the first in its arena to receive a credit rating from a major agency. If that’s not a badge of honor, I don’t know what is!
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