According to Bloomberg, Coinbase has entered a partnership with Goldman Sachs to make the bank’s first Bitcoin-backed loan. Coinbase received an amount of cash that they did not disclose in exchange for an amount of Bitcoin. “Coinbase’s collaboration with Goldman is the first step toward recognizing crypto as collateral,” according to Brett Tejpaul, the Head of Coinbase Institutional, in an email to Bloomberg. “This strengthens the connection between the fiat and cryptocurrency economies.” Loans backed by Bitcoin are still appealing in comparison to more traditional banks such as Goldman Sachs. But, according to Matthew Ballensweig, managing director of Genesis, the standard terms for these loans require the borrower to put up Bitcoin worth 40 percent to 60 percent of the collateral’s value. Although Goldman is new to using Bitcoin as collateral for loans, the bank did take a small step into the Bitcoin pool in March. At that time, the bank started a non-deliverable Bitcoin option, a Bitcoin derivative that pays the borrower. Galaxy Digital Holdings, a financial services company, founded by a former Goldman Sachs partner, served as the intermediary for this cryptocurrency transfer. “These kinds of bilateral agreements are rarely made in a vacuum,” according to an Arca report on institutional financial services firms that focuses on cryptocurrencies. However, because this type of transaction is not popular, Goldman is probably ...