- Client: Foreign National & Resident
- Loan Amount: Circa £3.5M
- LTV: 25%
- Interest Rate: Competitive
In this case, Enness was approached by a foreign national seeking to raise liquidity against a portfolio of staked cryptocurrency. The client intended to reinvest the funds into a business opportunity outside the UK. Staked crypto assets are digital tokens that have been committed to a blockchain network, typically to support network operations in return for potential rewards.
The main challenge was the structure of the client’s cryptocurrency holdings. The assets were held within a staking arrangement and could not simply be transferred or removed from the existing custodian. This meant Enness needed to identify a lender capable of taking appropriate security over the assets without disrupting the client’s existing custody arrangements.
Enness structured the financing through a Lombard facility, with the client’s staked cryptocurrency providing the collateral for the loan. This provided a way for the client to access liquidity while maintaining the existing structure of their digital asset holdings, subject to the lender’s custody and security requirements.
Time was also an important consideration, as the client required the funds within a few weeks to pursue a business opportunity. Enness moved quickly to identify a suitable lender and negotiated a facility of approximately £3.5M at 25% LTV with a competitive annualised interest rate.
The transaction demonstrates the importance of specialist knowledge when financing against non-standard assets. Staked cryptocurrency can present additional considerations around custody, transferability and the lender’s ability to establish appropriate security. By understanding the client’s circumstances and working with specialist lenders, Enness was able to structure a solution around these requirements.
Enness has access to over 500 lenders and works with high-net-worth and ultra-high-net-worth clients seeking bespoke financing solutions across a range of asset classes. Our international network also enables us to consider complex cross-border requirements and specialist forms of collateral.
For clients exploring liquidity against digital assets, crypto finance may provide an alternative to selling cryptocurrency holdings, although lending is subject to the relevant lender’s criteria, collateral requirements and market conditions.
If you or your clients are seeking finance against cryptocurrency or other non-standard assets, speak to a finance specialist to discuss the available options.
Disclaimer:
This case study is for information and illustrative purposes only and does not constitute financial, investment, tax or legal advice. Enness does not provide advice or recommendations on Securities-Backed Lending or investments, and lender introductions are unregulated. Cryptocurrency values can be highly volatile, and borrowers may be required to provide additional collateral or repay part of a facility if the value of the underlying assets falls. Appropriate professional advice should be obtained before making investment or financing decisions involving digital assets.
Information contained in our case studies is for market and illustrative purposes only. In some cases, these may be made up of multiple cases and are for illustrative purposes only.
Some case studies are made up of enquiries that have come into the business, not all business completes, and the posting of a case study does not represent a completed piece of business.
Property values can fall as well as rise, and you may not get back the amount originally invested. Property investments can be illiquid and may take time to sell. Where borrowing is used, your property may be repossessed if you do not keep up repayments on a mortgage or other loan secured against it.
