Second Major Bank Begins Accepting Crypto 'Stake' Collateral for Personal Loans
NEW YORK — A second major U.S. banking institution has announced it will now accept cryptocurrency holdings as collateral for personal loans, a move industry analysts say represents a significant stake in the mainstream adoption of digital assets.
Citizens Trust Bancorp confirmed to the press today that borrowers can now pledge Bitcoin and Ether to secure lines of credit up to 500,000 dollars. The program, launching next month, operates under a 70 percent loan-to-value ratio, meaning customers can borrow against a significant stake of their digital portfolio without being forced to sell their assets.
This decision follows a similar pilot program by Goldman Sachs last year. Financial experts note that by securing a stake in the volatile crypto market, traditional lenders are creating a new, regulated avenue for asset liquidity. The bank will utilize a third-party custody service to hold the digital collateral, aiming to mitigate risks associated with market fluctuations. The service is expected to be available in all 48 contiguous states.