Bitcoin exchange Coinbase is testing a new paid-subscription service that will give users access to additional features, also users can also borrow cash up to $1 million using Bitcoin as collateral.
Initially, a product called Coinbase One will be offered to a limited number of users. Its advantages include zero commission trading and priority phone support even on holidays and weekends.
Presumably, the subscription service aims to diversify Coinbase’s retail business, which generates most of its revenue from transaction fees. It is not yet known how much the exchange will charge for the new service.
The other big news is that Coinbase users can also borrow cash up to $1 million using Bitcoin as collateral.
Big news for the #BTC set …
We’re excited to announce that eligible customers can now borrow up to $1 Million USD from Coinbase.
— Coinbase (@coinbase) November 2, 2021
The company says on its website:
“Have you ever needed cash for something urgent, like medical bills or car repairs? In the past, you might have sold Bitcoin to cover it and incurred a taxable gain or loss. Now you don’t have to.
The new feature has no fees or credit checks involved, just a low APR [annual percentage rate] of 8%, according to its website. The borrowed cash can be instantly added to PayPal or transferred via ACH to your bank account.
Customers can borrow as much as 40% of the value of the Bitcoin in their account, up to $1,000,000.
Each month you only need to pay the interest due ($10 min). Pay off the balance when you’re ready. The Bitcoin you use as collateral remains safely held by Coinbase. It’s not lent out or used for any other purpose.
Coinbase will also offer fixed-term loans, currently only available for Coinbase customers in Connecticut. These will allow customers to borrow up to 30% of the Bitcoin value in cash, up to $100,000. They have an 8% APR with no credit check.”
As a reminder, to improve customer support, Coinbase buys the startup Agara, which provides support services based on artificial intelligence.