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      Arch Lending Implements Safeguards in Crypto Lending Following Celsius Bankruptcy

      Arch Lending, co-founded in February 2022 by Himanshu Sahay and Dhruv Patel, has emerged as a significant player in the crypto lending space, having originated over $350 million in loans without any client losses. This success follows the collapse of Celsius Network in July 2022, which resulted in the loss of approximately $4.7 billion in customer deposits. Arch Lending aims to differentiate itself by adopting a strict policy against rehypothecation, ensuring that client collateral is never lent out or used for other purposes.

      The firm has established a structural separation between its lending and custody functions by partnering with Anchorage Digital, the only federally chartered digital asset bank in the United States. This arrangement allows Arch Lending to securely hold client assets, mitigating risks associated with asset management that contributed to the failures of other firms like Celsius and Voyager. Additionally, Arch Lending employs a bankruptcy-remote structure to protect client assets from being included in any general creditor pool in the event of financial difficulties.

      Arch Lending's lending model is designed to be overcollateralized, requiring borrowers to provide collateral worth at least 1.67 times the amount they wish to borrow. For instance, to secure a loan of $60,000, a borrower must post at least $100,000 in Bitcoin. The firm also has a $100 million insurance policy through Lloyd’s of London to further safeguard its operations. Arch Lending operates under NMLS registration #2637200 and holds lending licenses across 44 states in the U.S.

      © 2026 KLEA News. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

      Source: KLEA News

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