Galaxy Digital launches crypto-backed credit line for retail clients

Galaxy Digital offers new way to borrow cash using crypto

Galaxy Digital, a financial services company focused on digital assets, has launched a new credit line for its retail clients. The product allows users to borrow cash using their Bitcoin, Ethereum, or Solana holdings as collateral without selling those assets.

The credit line is available to eligible clients of GalaxyOne, Galaxy Digital’s retail platform. It combines eligible crypto assets into a single revolving line of credit, providing liquidity for expenses or investments while keeping the original crypto holdings intact.

How the new credit line works

• Clients can borrow against Bitcoin (BTC), Ethereum (ETH), and Solana (SOL), including staked SOL.
• No origination fee and an annual percentage rate (APR) of 8.99%.
• Funds are available instantly in U.S. dollars (USD) or USD Coin (USDC), a stablecoin pegged to the U.S. dollar.
• Collateral is not rehypothecated, meaning it is not used for other purposes by the lender.
• Initially available in 40 U.S. states.

What Galaxy Digital says about the launch

Zac Prince, Managing Director of GalaxyOne, stated in a press release: "We're excited to bring a competitive crypto-backed borrowing product to market via our growing retail platform. By leveraging Galaxy’s institutional infrastructure, we are able to offer competitive rates, security and flexibility with our new crypto portfolio line of credit product."

The company designed the product for investors who want to access cash without selling their crypto assets, which can have tax implications and may require navigating complex processes.

How this compares to other crypto lending products

Galaxy Digital’s new offering joins a growing list of similar products in the market. Other companies, such as Ledn, Coinbase, and Nexo, also allow users to borrow against their crypto holdings. For example:

• Ledn offers Bitcoin-backed loans in USD, USDC, and other currencies.
• Coinbase provides a similar service, advertising rates as low as 5%.
• Nexo allows users to combine multiple cryptocurrencies as collateral for a credit line.

What is confirmed about the new credit line

• Galaxy Digital has officially launched the GalaxyOne Crypto Portfolio Line of Credit.
• The product is available to eligible GalaxyOne clients in 40 U.S. states.
• Clients can borrow against BTC, ETH, and SOL, including staked SOL.
• The APR is 8.99%, and there is no origination fee.
• Funds can be received in USD or USDC, and collateral is not rehypothecated.

Why this could matter for crypto investors

The new credit line provides a way for crypto holders to access cash without selling their assets. This can be useful for investors who:

• Want to avoid potential tax consequences of selling crypto.
• Prefer to keep their crypto holdings for potential future gains.
• Need liquidity for expenses or other investments while remaining invested in crypto.

The product also reflects the growing trend of financial services tailored to digital asset holders, offering more flexibility in managing crypto wealth.

Sources

• The Block
• Galaxy Digital Press Release