Bitcoin-backed loan platform Ledn has sold about $188 million of bonds tied to Bitcoinâcollateralized consumer loans into the mainstream assetâbacked securities (ABS) market, Bloomberg reported on Wednesday, citing people familiar with the matter.Â
In a first-of-its-kind deal, one of the two tranches â the investmentâgrade portion âreportedly priced at a spread of roughly 335 basis points over a benchmark rate, implying that investors are demanding 3.35 percentage points in extra yield to hold cryptoâlinked credit risk rather than conventional consumer ABS.
The deal is structured through Ledn Issuer Trust 2026â1, which securitizes a pool of 5,441 shortâterm, fixedârate balloon loans extended to 2,914 US borrowers, backed by 4,078.87 Bitcoin (BTC) held as collateral, according to S&P Global Ratingsâ preliminary documentation on Feb. 9.
How the structure and ratings stack up
Balloon loans are structured with relatively small periodic payments and a large lumpâsum âballoonâ payment at maturity, which keeps nearâterm payments low but leaves a sizeable principal balance due at the end.
S&P assigned preliminary BBBâ (sf) and Bâ (sf) ratings to the $160 million senior Class A notes and $28 million subordinated Class B notes, respectively.
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A BBB- rating is the lowest tier of investment-grade debt, reflecting an adequate capacity to meet financial commitments but higher vulnerability to adverse conditions than higherârated bonds, while Bâ sits in deep nonâinvestmentâgrade âjunkâ territory, where default risk is materially higher.
Jefferies Financial Group acted as the sole structuring agent and bookrunner, as a major Wall Street dealer intermediated between institutional fixedâincome investors and this new form of cryptoâlinked exposure.Â
BTC increasingly seen as legitimate collateral
Bitwise head of research Europe, Andre Dragosch, told Cointelegraph that the fact that Ledn was able to package these loans into a traditional ABS implied that BTC is âincreasingly seen as safe and legit collateral by traditional financial institutions.â
He highlighted major banks like JPMorgan offering BTC-backed loans to customers as a further indication of this. âBitcoin is increasingly being integrated into traditional finance as the new pristine collateral,â he said.
Jinsol Bok, research lead at Four Pillars global crypto research firm, told Cointelegraph that this means liquidity no longer needs to remain locked up and âcan instead be expanded into new lending,â meaning that the size of the BTC collateralized lending market could âgrow far beyond its current level in the future.â
Related: AnchorageâMezo partnership opens institutional access to BTC-backed loans
He added that, unlike real estate mortgages, BTC collateralized loans could be transparently tracked onchain and liquidated in a programmable manner.
âFor this reason, I believe that the risks associated with ABS in this context do not need to be excessively overstated.”
What investors are buying
Assetâbacked securities are bonds funded by pools of loans, so investors in Lednâs notes do not own Bitcoin (BTC) directly.
Instead, they take on credit and structural risk to a pool of BTCâsecured loans whose performance depends on borrower repayments and the lenderâs ability to liquidate collateral during market stress.
âThese loans generally have a low default rate because they tend to have low LTV [loan-to-value] ratios and are well capitalized with BTC,â Dragosch said.
Founded in 2018, Ledn says it has funded over $9.5 billion in loans so far in over 100 countries. The company received a strategic investment from Tether, the issuer of the USDt (USDT) stablecoin, in November 2025.
Cointelegraph reached out to Ledn for comment but had not received a response by publication time.
Big questions: Should you sell your Bitcoin for nickels for a 43% profit?
