Cryptocurrency companies like FalconX, GSR, and B2C2 play the role of shadow banks to achieve high returns
ChainCatcher news, according to The Information, the collapse of major cryptocurrency-friendly banks last year caused significant trouble for the cryptocurrency market, making it more difficult for hedge funds and other cryptocurrency investors to transfer funds at the speed required by most exchanges.However, an increasing number of cryptocurrency brokerage firms (such as FalconX) and cryptocurrency trading companies (including GSR and B2C2) have stepped in to provide short-term financing to ensure that their clients' trades can be settled immediately, generating substantial returns in the process. Several cryptocurrency brokers are acting as shadow banks, providing short-term loans to bridge the timing mismatch, charging annual interest rates of up to 25%.