Cantor Fitzgerald Expands Crypto Lending With $2 Billion Bitcoin Financing Business

Wintermute, a leading crypto market maker, has secured a Bitcoin-backed credit line from Cantor Fitzgerald. This facility is part of Cantor Fitzgerald's $2 billion Bitcoin Financing Business initiative, which is designed to offer secured credit facilities to institutional crypto firms. The exact size of Wintermute’s credit line was not disclosed, but CEO Evgeny Gaevoy emphasized its importance in managing the capital-intensive nature of over-the-counter (OTC) crypto trading and settlement. According to Gaevoy, the facility will enhance Wintermute's ability to hedge risks effectively across various exchanges and maintain broad market coverage.

The deal is a significant milestone for Cantor Fitzgerald as it expands its presence in the crypto lending space. The $2 billion Bitcoin Financing Business, launched in mid-2024, has already provided financing to other prominent firms. FalconX Ltd. plans to draw over $100 million from the program, while Maple Finance has closed the first tranche of its facility. These developments indicate a growing interest from traditional financial institutions in the crypto market, despite the industry's recent challenges.

Cantor Fitzgerald's entry into crypto lending signals a cautious revival of the sector, which was severely impacted by high-profile collapses such as Celsius Network and BlockFi in 2022. Other firms, including Bitcoin software company Blockstream Corp. and crypto-focused private bank Xapo Bank, have also made significant moves in the crypto lending space. Blockstream Corp. recently raised several billion dollars to support its crypto lending funds, while Xapo Bank started offering Bitcoin-backed loans of up to $1 million as of March.

The resurgence of the crypto lending market is evident, with the total size of the market reaching $36.5 billion by the end of 2024. This figure represents a more than doubling from its low in Q3 2023, although it remains significantly below its 2021 peak of $64.4 billion. The growth in the crypto lending market reflects the increasing institutional interest and the potential for further expansion in the sector.