Crypto lender Genesis provided $5.2 billion in new loans in the third quarter of 2020, more than double the previous record of $2.2 billion in the previous quarter.
Loans issued to corporate borrowers such as hedge funds and trading companies are mainly denominated in Bitcoin (BTC), Ethereum (ETH), Bitcoin Cash (BCH) and cash.
According to the third quarter digital asset report shared by the American company with news.Bitcoin.com on October 30, Genesis’s outstanding active loans increased by 50% from $1.4 billion in the second quarter to $2.1 billion. .
Since its creation in March 2018, Genesis has processed a total of $13.6 billion worth of crypto loans.
In the third quarter, Bitcoin-based loans as a percentage of total loans dropped sharply, from 51.2% to 40.8%. BCH loans almost stagnated at 4.3%, while ETH loans almost doubled to 12.4%.
Genesis said: “The main motivation for this portfolio transfer comes from the impact of liquidity mining on decentralized financial (defi) agreements.”
“We have seen defi interest rate arbitrage promote new major issuances, and our counterparties have begun to actively borrow Ethereum and stablecoins to improve liquidity mining strategies. These transaction parties have also borrowed related governance tokens, such as UNI, YFI , COMP and LEND to hedge its future physical benefits.”
The lender said that all its business lines, including derivatives and spot trading, are expected to achieve substantial growth.
In this quarter, the volume of derivatives transactions (including options and futures) soared to US$1 billion from the previous US$400 million. Genesis did not start trading derivatives until the second quarter of 2020. Spot trading volume increased by approximately 15% month-on-month to US$4.5 billion.
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