The DTCC recently announced that during its annual line-of-credit facility renewal on April 30, it will be adjusting the collateral values for specific securities, potentially impacting their position values in the collateral monitor. However, crypto enthusiast K.O.
Kryptowaluty pointed out that the change only affects inter-entity settlements within the line of credit system, as mentioned in a post on X. A line of credit is a loan agreement between a financial institution and an individual or company, allowing the borrower to withdraw funds up to a predetermined credit limit and pay interest only on the amount borrowed.
Kryptowaluty also mentioned that the use of cryptocurrency ETFs for lending and as collateral in brokerage activities would likely continue unaffected, depending on the risk tolerance of individual brokers. Despite the DTCC’s opposition to cryptocurrency ETFs, other established players do not share the same view.
In February, the approval of ten Bitcoin ETFs in the U.S. on Jan. 11 led to an estimated 75% of new Bitcoin investments, but recent weeks have seen a decline in inflows. The regulatory body is extending the deadline for public comments to the next 21 days and rebuttals to 35 days.
The agency is also questioning whether options on spot Bitcoin ETFs should adhere to the same rules as stocks.