Ledn Completes First Bitcoin-Collateralized ABS Issuance, Raising $188 Million

According to CoinDesk, crypto lending company Ledn announced the completion of its first asset-backed securities (ABS) transaction using Bitcoin as collateral, raising $188 million and setting a precedent in the crypto credit market. Reports indicate that this transaction packaged over 5,400 individual loans secured by Bitcoin holdings into bonds, with a weighted average loan interest rate of 11.8%. The asset-backed securities rely on the cash flow from the underlying loans as the repayment source, allowing investors to earn corresponding returns through the bonds. The issuance is divided into two tranches, with the investment-grade tranche priced at 335 basis points above the benchmark rate. Jefferies acted as the exclusive structuring and book-running manager for this transaction. Given Bitcoin's significant price volatility (with a maximum drawdown of approximately 50% over the past four months, dropping to as low as $60,000), the structure incorporates an automatic collateral liquidation mechanism. This mechanism enforces mandatory liquidation when risk thresholds are breached, protecting investors during periods of extreme market fluctuations. Industry experts believe this issuance marks the first entry of Bitcoin-collateralized loans into the traditional asset securitization market framework, providing a new pathway for the integration of crypto credit assets with mainstream capital markets.