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Jimmy Aki
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Jimmy Aki
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Crypto lending platform Ledn recently reported a big milestone for 2024, processing $1.67 billion in loans by the end of the third quarter (Q3).
Ledn said the loan portfolio comprised $258.7 million in retail and $1.41 billion for institutional clients. The retail growth was attributed to the Celsius refinancing program, the approval of crypto ETFs, and reduced market volatility.
In an exclusive interview with CryptoNews, John Glover, Ledn’s Chief Investment Officer, discussed the factors driving this growth, institutional demand, and the company’s risk management approach.
Retail Loan Growth Driven by Celsius Refinancing Program And Institutional Loan Expansion
Ledn’s success in its Celsius refinancing program has emerged as a cornerstone of the company’s retail growth strategy.
The program’s impact became evident when Ledn successfully refinanced nearly two-thirds of the eligible Celsius loan book, providing a lifeline to clients who might otherwise have been forced to liquidate their assets during bankruptcy proceedings.
In discussing this achievement, John Glover was quite transparent about the program’s success.
“We secured over $40 million in refinanced Celsius loans in Q1 alone, nearly 2/3 of the total amount refinanced in the market. That’s significant, and it was a key driver in helping us process $100 million in retail loans during Q1, our most successful quarter since inception,” Glover said. It shows that clients recognize when you maintain strong risk management practices and build trust with the market.”
“The crypto lending market has experienced its share of disruptions, but that’s not unusual in emerging financial sectors,” he continued. “What matters is how you operate through these cycles. Our record of zero loan losses and consistent service since 2018 speaks for itself.”
This effort drove a 225% increase in retail loans year-over-year, with $100 million processed in Q1 2024.
The crypto lender also witnessed exponential growth for institutions, reaching $437.7 million in Q3. This stems from institutional clients increasingly seeking digital asset-backed loans as an alternative to traditional financing, particularly in the current environment of tight monetary policies.
Similarly, the company’s implementation of third-party proof-of-reserves and monthly Open Book Reports has built considerable trust among institutional lenders.
This trust has enabled the company to close high-profile deals, such as the industry’s first syndicated Bitcoin-backed loan with Sygnum.
“Our institutional partners need to see exactly how their capital is deployed and protected,” Glover explained. “It’s also a reason we felt it important to get our loan book rated recently from Agio Ratings. Institutional partners want to see our liquidation engine performance, our risk management protocols, our collateral positions.”
Addressing Challenges of Product Innovation, Risk Management, And Scaling
Glover emphasized Ledn’s focus on risk management and innovation.
The launch of Custodied Loans in December 2023 has become popular, especially among clients who experienced the crypto lending crisis 2022.
The product’s success is evident in the numbers: It accounted for nearly one-third of Ledn’s retail loan originations in 2024.
Meanwhile, Glover attributed Ledn’s longevity and success to its strict risk management practices.
“It’s why we are still standing when our major competitors are out of business and have won most of the Celsius refinancing opportunities,” he explained. “It’s also a big reason why we’re seeing top-tier USD funding partners work with us, as evidenced by the recent announcement of the first-ever syndicated BTC-backed loan.”
Regarding risk management, Ledn adheres to a simple but effective framework that includes strict separation of client assets, consistent communication with institutional partners, and enhanced transparency through monthly Open Book Reports.
These efforts have enabled the company to process over $1.67 billion in loans this year while staying true to its risk mitigation strategies.
Unlocking New Milestones with Regulatory Clarity and Partnerships
Despite intensifying competition in the digital asset lending space, John Glover remains optimistic about the company’s future growth prospects. He believes the upcoming US elections may bring much-needed regulatory clarity, further accelerating Ledn’s expansion.
“Any post-election regulatory clarity could amplify the trends we’re already witnessing,” Glover noted.
Additionally, the Ledn executive highlighted the increasing comfort of traditional financial institutions with Bitcoin-backed loans, paving the way for broader adoption.
Ledn’s growth momentum is expected to continue, driven by its expanding services and geographic reach. A recent strategic partnership with Parallel, a prominent crypto real estate broker in the Cayman Islands, exemplifies this growth strategy.
This collaboration, announced on August 24, enables crypto investors to purchase regional real estate directly with digital assets, eliminating the need for fiat currency conversions or asset sales.
