Need cash? Your IPv4 stash can now be collateral for $100M loans
Yeah, yeah ... if we were all exclusively on IPv6, this wouldn't be a thing. But here we are
IP address marketplace IPv4.Global has started offering loans on terms that consider public IPv4 network addresses as valid collateral.
The loans build on a product announced last year by network operator Cogent, which issued $206 million worth of notes backed by its IPv4 assets.
Debt notes are a way to raise money. The issuer sells notes to investors, pockets the cash, and promises to repay the purchase price plus interest. Cogent’s notes were therefore an invitation to investors to lend it $206 million for five years.
If Cogent doesn’t pay, those who hold notes get its IPv4 addresses.
They're a valuable asset: AWS rents them for $43.80 a year and they change hands for about $30 apiece.
Cogent had its own stash of public IPv4. IPv4.Global has productized Cogent’s play and is offering to arrange loans to anyone that holds IPv4 addresses.
“Companies needing working capital haven’t been able to leverage the value of their IPv4 addresses,” IPv4.Global senior vice president Lee Howard told The Register. “Most commercial lenders would not include IPv4 holdings, so we saw a need we could serve.”
Howard said his biz has already accepted public IPv4 as collateral “for a datacenter operator so they can grow their cloud business.”
It’s 2025 so that could mean turning IPv4 into H200s – the model number of Nvidia’s latest and greatest AI accelerators.
Howard said IPv4.Global can lend up to $100 million and possibly more for the right client.
“While we’re using the IPv4 addresses as our primary collateral, the specific terms of each loan will depend on the borrower’s credit profile and balance sheet,” he said.
The outfit hasn’t set a maximum or minimum on the number of addresses it requires for a loan. Howard said one consideration for loans is “the time it would take for the market to absorb the collateral.”
That’s a reference to what happens if a borrower doesn’t repay a loan.
“If there is a default, we will be able to control the monetization of our collateral,” Howard said, suggesting IPv4.Global would arrange a sale of the addresses on its own platform.
While demand for public IPv4 network addresses remains strong, it could be a while before IPv4.Global could offload a large quantity of addresses.
- Huawei handed 2,596,148,429,267,413,
814,265,248,164,610,048 IPv6 addresses - IPv6 may already be irrelevant – but so is moving off IPv4, argues APNIC's chief scientist
- Vietnam plans to convert all its networks to IPv6
- 250 million-plus reserved IPv4 addresses could be released – but the internet isn’t built to use them
If you’re wondering what business an IPv4 marketplace has arranging loans, know that IPv4.Global part of a financial services company called Hilco Global which already does similar things in other markets. One of its offerings is accounts receivable financing – the practice of paying a company a portion of outstanding bills owed by its customers, then taking on the responsibility for going after the full amount. Arranging loans is therefore not a massive stretch for IPv4.Global.
Of course none of this would be necessary if the world would just hurry up and adopt IPv6, which has hundreds of undecillion addresses up for grabs. A single undecillion is 1036.
That IPv4.Global sees a market for using IPv4 as collateral is clear evidence that plenty of orgs want to keep using IPv4 for the foreseeable future. ®
Bootnote
The Register uses IPv6 for delivering some static content, such as images, and other things, but yes, the front-door dotcom still (for now) resolves to IPv4. We're working on it.