Just saw a report from PANews that BTC can now be used as collateral for loans.
This means that Bitcoin is no longer just for speculation or storing in wallets for price increases; it can now really be used to borrow money from banks, and not just small banks, but major institutions like BNY Mellon, Morgan, Citibank, and Bank of America.
However, this also brings about some very real changes.
First, the identity of BTC has changed.
In the past, banks viewed Bitcoin as high-risk and highly volatile, but now it has become a viable collateral option, which means it has been included in the list of financable assets—a significant development in the financial system.
Second, the way large capital operates will change. Institutions can use BTC as collateral to borrow USD and then invest that USD in other assets, transforming Bitcoin into a part of the capital cycle, rather than simply holding spot.
Third, is the bull market coming to an end? Each cycle typically involves:
• retail investors speculating first
• institutions entering next
• finally becoming financial products, collateral, and leverage tools.
But the risks are also significant. Once this model becomes widespread, the chain liquidations during future downturns will be more severe than before, because:
• it’s not just about contract liquidations
• there will also be pressure from “insufficient collateral value → banks calling for repayment → forced selling of coins.”
So this is a very typical “long-term super bullish + short-term volatility amplifier” signal.
In summary, BTC is being formally integrated into Wall Street's financial pipeline, its status has risen, but future fluctuations are likely to be more intense.
