Comparison
How does a collateral card differ from a line of credit?
A securities-backed line of credit is borrowing from a lender against a portfolio you keep, drawn as cash, with the portfolio as collateral. A card against your own collateral draws at the point of sale instead, charge by charge, and nothing is sold.
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How does a securities-backed line of credit work?
A lender values the portfolio, lends up to a share of that value, and the portfolio stays invested as collateral. If the value falls below a required level, the lender can ask for more collateral or sell positions.
Public explainers from FINRA and Investor.gov are collected on our Learn page.
How is a margin loan different?
A margin loan is borrowing from a broker against securities in the same account, usually to buy more securities. A line of credit is drawn as cash for other purposes, and the same call for more collateral applies to both.
How does a card against your own collateral differ?
The draw happens at the point of sale, one charge at a time, checked against your spending power and the required level at the moment you tap. There is a card and an account in place of an application and a wire.
Gether values what you deposit, holds it as collateral, and the card spends against the share it counts for. Drawn balances have to be repaid.
The draw happens at the point of sale, one charge at a time.
What is the same in all three?
The position stays invested, the lender, or Gether, holds it as collateral, and a fall in its value can end in a sale. In every model the balance has to be repaid.
What does Gether count today?
Today the rail backs USDC, and other assets are counted as the rail adds them. Gether is in a waitlist phase and is not a bank.
Spend against what you hold.
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