Expobank, the former Russian subsidiary of Barclays, has issued a digital currency collateral loan to Russian entrepreneur and tax consultant Mikhail Uspensk. Uspenk bought Waves tokens (WAVES) in 2018 during their ICO but quickly learned that his WAVES were useless. Therefore, he decided to use his WAVES as collateral for a loan he has taken out at Expobank. https://twitter.com/sasha35625/status/1295958139284738048 “I don’t refuse plans to use Waves and I don’t see any point in selling tokens, but they should not be dead weight in my pocket, but should work,” Uspensk told local Russian media outlet Kommersant. The transaction between Expobank and Uspensk is likely to set a legal precedent regarding digital currency in Russia. Collateral-backed loans are becoming popular Digital currency collateral backed loans are becoming increasingly popular. What started as the most popular use-case for DeFi platforms (lending and borrowing) has become a product that is now offered by some of the leading companies in the digital currency industry as well as traditional banks. Recently, cryptocurrency exchange Coinbase announced that they would be offering digital-currency collateral-backed loans and that individuals can receive a loan up to 30% of their digital currency holdings (with a $20,000 ceiling). Before Coinbase, Silvergate, the digital currency friendly bank located in California, launched a digital currency collateral backed loan product that was in high demand. In Q1 2020, the demand for Silvergates's digital currency collateral loan grew by 88% to $22.5 million. What does this tell us The popularity of digital currency backed loans tells us that many consumers believe that having fiat is more valuable than having digital currency. Uspensk may have said it best when he referred to his WAVES tokens as “dead weight in his pocket.” A majority of digital currencies have no utility and their primary use-case is speculation. However, if you are not watching the charts day in and day out for these tokens, holding them presents you with an unnecessarily large amount of risk. It makes sense that we are seeing more people and companies opt into digital currency collateral loans—because almost 100% of the time, the fiat they receive will be more valuable and will indefinitely have more utility than their digital currency tokens.