Goldman Sachs employee shared details of first loan secured by HTS: details

Popular multifunctional bank Goldman Sachs appears to be serious about joining other financial giants that have started providing crypto services. Earlier, based on Bloomberg, we reported that the aforementioned financial institution issued its first cash loan secured by bitcoin. A Goldman Sachs representative, who was not named, told reporters about it.

As part of a conversation with the media, a hidden source tells us that Goldman Sachs thought for a very long time about whether to decide on this experiment. According to the bank’s employee, the management decided to try it after all, issuing a cash loan secured by VTS owned by the borrower.

“In fact, the loan process itself turned out to be very interesting. This is new to us, because the procedure for processing a loan secured by bitcoins is quite different from the traditional one. In this situation, we required from the client completely different documents and data, the process of checking the solvency of the borrower was also carried out differently, “- stressed the representative of the financial institution.

A classified Bloomberg source also said that despite the loan already issued, Goldman Sachs is very worried that it may face difficulties amid the high volatility of bitcoin. Thus, noted the bank’s employee, the situation around the loan is constantly monitored by the security department, as well as the division of risk management.

“Originating a loan where bitcoin acts as collateral is a big risk for both the bank and the borrower. Although, of course, it depends on the terms of the loan. In this case, the situation looks like this: for example, if the value of VTC drops drastically, Goldman Sachs reserves the right to demand that the client immediately increase the amount of collateral. If the borrower does not respond to this request, the financial institution can immediately liquidate its collateral, that is, sell the bitcoins at market price,” the source added.

Cointelegraph analysts suggested that Goldman Sachs has already started having problems with a recent loan secured by VTC. Against the background of a significant collapse of bitcoin, the financial institution, in all likelihood, asked the borrower to increase the collateral, which included the terms of the contract. Regarding this point, unfortunately, Bloomerg source did not give any comments.

By the way, it’s worth noting that financial giants headquartered on Wall Street are being increasingly “absorbed” by the digital industry, Bloomberg analysts say. This shows only that the cryptocurrency industry at the moment is at the peak of its popularity and acceptance. Experts also note that the most favorable factor for the “new money”, by the way, is precisely the introduction of cryptographic technology in the traditional banking sector.

Recall, earlier we reported that Goldman Sachs experts fear that bitcoin will take away a significant market share from gold.