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Crypto Lender Ledn Now Offers ETH-Backed Loans to Meet Growing Demand

Ledn, based in the Cayman Islands, revealed on Wednesday its introduction of loans secured by Ether, prompted by considerable demand from clients for such a service.

These ETH-backed loans on the platform come with a starting loan-to-value ratio of 50% and an initial annual interest rate of 10.4% (equivalent to 12.4% APR), mirroring the structure of its BTC-backed loan program.

Mauricio Di Bartolomeo, Ledn’s co-founder and Chief Strategy Officer, shared with Cryptonews that many users are opting to utilize Ethereum as collateral rather than Bitcoin, citing a preference to safeguard BTC in cold storage. Additionally, the increasing regulatory acceptance of Ether serves as another motivation for offering these loans, as outlined by the company.

The rising appeal of Ether is further emphasized by heightened interest from institutional investors. Major players in the industry, such as BlackRock and Fidelity, are currently in the process of seeking approval from the US SEC to launch their own spot-based Ethereum ETFs.

Navigating Ledn’s Ether-Backed Loan Process

Bartolomeo elaborated on the simplicity of the process, stating, “You do not need to learn how to interact with protocols to access a Ledn ETH-backed loan.”

Here’s a breakdown of how it operates: Clients complete an application on Ledn’s platform, a task that typically takes less than 2 minutes. Ledn then assesses the application, and upon approval, generates a collateral address for the client to transfer their Ethereum to.

Upon receiving the loan collateral, Ledn disburses the loan. Although the loan is denominated in USD, clients have the option to receive it in USD stablecoins or their preferred fiat currency. Typically, Ledn loans are approved and funded within 24-48 hours.

Since 2018, Ledn reports facilitating nearly $5 billion in Bitcoin-backed loans, with no instances of client asset loss.

Ledn Plans to Introduce E2X Loans

Ledn offers ETH-backed loans in both Custodied and Standard options, giving clients the freedom to choose their preferred collateral management approach. Additionally, customers can gain insight into how their collateral, interest rates, and loan funding are managed through Ledn’s monthly Open Book Report.

The platform offers global access to its ETH-backed dollar loans, featuring low minimums, no monthly payments, and flexible repayment options.

In the future, Ledn plans to expand its ETH loan offerings by introducing an E2X service, similar to its B2X loans, in jurisdictions where it is appropriate. B2X is a loan product that allows clients to double their BTC holdings.

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Cryptocurrency is essentially virtual money that operates in a decentralized manner, not through a bank but directly on multiple independent computers.

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