IPv4.Global, the world’s largest marketplace for IPv4 addresses, has launched a loan programme that allows businesses to use their IPv4 addresses as collateral.
A New Way To Get Funding
This new initiative gives companies access to funding while still retaining full use of their IP assets, responding to the strong ongoing demand for IPv4 despite the slow transition to IPv6.
Who is IPv4.Global?
IPv4.Global is the largest and most transparent marketplace for IPv4 addresses, i.e. the unique numerical identifiers assigned to devices on a network, allowing them to communicate over the internet. The company facilitates the buying, selling, leasing and now the lending of these assets. A division of Hilco Streambank, IPv4.Global has completed more transactions in this space than any other provider, having brokered the sale of over 55 million addresses. With a reputation for credibility and efficiency, it has become the go-to platform for organisations looking to monetise their IPv4 holdings.
How the Loan Programme Works
The idea of using IPv4 addresses as financial instruments is not entirely new. For example, network operator Cogent previously issued $206 million worth of debt notes backed by its IPv4 assets. However, IPv4.Global has gone a step further by offering loans directly secured by these addresses.
Under the new scheme, businesses can leverage their IPv4 holdings to access loans while still retaining full use of their addresses. This differs from previous models that used lease revenues as security, as the addresses themselves now serve as collateral.
Lee Howard, Senior Vice President of IPv4.Global, highlighted the unique nature of the initiative, saying: “We just successfully implemented our lending programme for a data centre operator so they can grow their cloud business, making us the first and only company lending against IPv4 addresses today.”
The programme does not have a strict minimum or maximum address requirement, with each loan’s terms tailored to the borrower’s financial standing and balance sheet. However, Howard has noted that a key consideration is how quickly the market could absorb the addresses in case of default, meaning larger loans may require more structured risk assessments.
Why This Matters
Despite the slow transition to IPv6 (a newer protocol designed to replace IPv4 with a vastly larger address pool), demand for IPv4 addresses remains strong, driving their market value upwards. AWS, for example, rents public IPv4 addresses for $43.80 per year, and recent transactions have seen them sell for around $30 per address.
By allowing businesses to use these digital assets as collateral, IPv4.Global is effectively unlocking a new source of liquidity for organisations in need of working capital. This is particularly useful for companies in cloud computing, data centre operations, and telecoms, where maintaining access to IPv4 resources is crucial for day-to-day operations.
The Key Benefits of IPv4-Based Loans
Some of the key benefits of IPv4-based loans include:
– Immediate access to capital. Companies can leverage their IPv4 holdings for financial flexibility without selling them outright.
– Retained operational control. Unlike asset sales, using IPv4 addresses as collateral allows businesses to keep them in use.
– It’s a new financing avenue. Many commercial lenders do not consider IPv4 holdings in loan assessments, making this a unique funding opportunity.
– Support for growth. Businesses needing capital to expand, particularly in cloud and hosting sectors, can now do so without disrupting operations.
Challenges and Potential Risks
While the benefits are clear, using IPv4 addresses as collateral is not without its risks. For example, these include:
Market fluctuations. The value of IPv4 addresses depends on supply and demand, which could shift as more organisations adopt IPv6.
The risk of default. If a borrower fails to repay their loan, they could lose control over vital IPv4 assets, potentially affecting their network operations.
Regulatory concerns. As IPv4 addresses take on greater financial significance, they could attract new regulatory scrutiny, particularly in markets with evolving digital asset laws.
What Does This Mean For Your Business?
By providing businesses with an alternative means of securing capital without relinquishing operational control, IPv4.Global’s move (to accept IPv4 addresses as loan collateral) opens up new financial opportunities, particularly for organisations in sectors such as cloud computing, data centre management, and telecoms, where IPv4 addresses remain an essential resource.
For UK businesses, this could offer a novel way to raise funds while preserving critical network infrastructure. Many companies still rely on IPv4 addresses for their digital operations, and with limited availability continuing to drive market prices higher, leveraging these assets for financing could be a practical solution for those looking to scale without selling off key resources. At the same time, lenders entering this space may see potential in offering similar financing models, although risk management will be crucial given the uncertainty surrounding long-term IPv4 valuations.
For other stakeholders, including investors and policymakers, this development highlights the growing financialisation of internet infrastructure. While it demonstrates the enduring demand for IPv4 and its potential as a financial instrument, it also raises questions about market stability, regulatory oversight, and the eventual transition to IPv6. If IPv4 addresses continue to be treated as high-value assets, the shift to IPv6 could be further delayed, creating ongoing complexities for businesses and regulators alike.
It seems, therefore, that IPv4.Global’s initiative reinforces the idea that digital assets are becoming increasingly intertwined with traditional financial mechanisms. Whether this approach gains widespread adoption remains to be seen, but for now, it offers a fresh avenue for businesses seeking capital while demonstrating the lasting relevance of IPv4 in a changing technological landscape.