The cryptocurrency-loyal bank stopped issuing loans secured by mining equipment

BankProv, which was previously considered extremely friendly to cryptocurrencies, announced that it stopped issuing loans secured by the equipment. According to statements by representatives of the bank, the loan portfolio with such collateral decreased by 50% during the fourth quarter. 

A statement was filed with the SEC indicating that the number of loans collateralized by mining devices will regularly decline:

We now have $41.2 million in loans that are tied to digital assets. There were $26.7 million in loans secured against machines. 

Since 2021, the number of loans secured by asic has grown at a tremendous rate. The financial flows raised have been used to expand capacity. However, in a bear market, this model has broken down. The cost of mining equipment fell precipitously, losing up to 90%. As a result, margin calls and collateral seizures were increasingly common. 

In 2022, BankProv wrote off $47.9 million and recovered $24.7 million worth of devices.