By Mark Hunter
1 day agoThu Dec 16 2021 10:03:16
Reading Time: 2 minutes
Ledn has raised $70 million through an investment round, valuing the company at $540 million
Ledn will use the money to grow its Bitcoin-backed mortgage instrument
The product is the first of its kind
Cryptocurrency lending platform Ledn has announced that it has raised $70 million that it will put towards the creation of an instrument that allows Bitcoin holders to take out a mortgage based on the value of their holdings. Ledn revealed the investment boost yesterday, which takes the valuation of the company to $540 million, but of more interest to the crypto community will be the ins and outs of the Bitcoin-backed mortgage idea.
Bitcoin-backed Mortgage at Pilot Stage
Ledn’s Bitcoin-backed mortgage product, the first of its kind to hit the market, will enable Ledn clients to use their bitcoin holdings to purchase property while continuing to realize any price appreciation from both assets. As part of the mortgage loan, Ledn clients will be able to blend an equal amount of Bitcoin and property collateral, a unique collateral structure that relies on the stability of real estate to buffer against the volatility of Bitcoin.
The Bitcoin-backed mortgage instrument is currently in pilot mode in the U.S. and Canada, but Ledn hopes to roll it out in early 2022, with a waitlist for the product already growing. The company is targeting over $100 million in Bitcoin-backed mortgage deals by the end of Q1 2022.
Ledn Wants to Help Whales Utilize Holdings
Adam Reeds, co-founder and CEO of Ledn, said in a press release that:
Most people that hold extensive wealth in Bitcoin still can’t utilize their assets to qualify for a mortgage at a bank. Our clients want to diversify their portfolio in order to protect their wealth and then utilize that wealth for instances such as purchasing a home, but one should not come at the expense of the other. That is why we are launching this product, in order to provide access to key financial products for those who choose to invest outside the mainstream of legacy banks.
If Ledn manages to find a way to balance the volatility and price appreciation of Bitcoin with the relative stability of property prices, it could be the first mover in a quickly crowded Bitcoin-backed mortgage field.