According to Bloomberg, Digital Prime Technologies has launched a cryptocurrency lending platform, allowing clients like Xapo Bank to lend digital assets to other institutions, such as EDX Clearing and global institutional credit network Hidden Road Partners. The Jersey City, New Jersey-based firm's launch coincides with growing optimism that a Bitcoin exchange-traded fund (ETF) will be approved in the US within months. If approved, Digital Prime expects ETF issuers to have a significant demand for borrowing Bitcoin, potentially jumpstarting the crypto-lending industry.
Digital Prime's DLCC Prime subsidiary recently received Financial Industry Regulatory Authority membership. The platform, Tokenet, enables authorized participants to create new inventory in the ETF when demand is high. If Bitcoin's price suddenly increases, they may choose to borrow the cryptocurrency and buy it later at a lower price. This process helps keep the ETF's price in line with its net-asset value. Digital Prime's CEO, Chris Runnels, and COO, Michael Oved, both have backgrounds in traditional finance, with Runnels previously serving as a managing director at Cantor Fitzgerald.
