Ledn closes landmark asset-backed bond transaction

A crypto lender moved a large pool of retail loans into a securities vehicle and sold bonds to the market, bringing in $188 million. The financed receivables stem from over 5,400 individual loans that use customers’ bitcoin as collateral.

Deal designers split the issuance into slices, with the safer slice priced roughly 335 basis points above the reference rate — an indication of how investors are assessing risk versus return. The borrower portfolio carries a pooled interest profile around 11.8%, which feeds cash flows to bond investors.

Risk controls matter here: the structure executes automatic liquidation of pledged crypto when pre-set thresholds are crossed, an engineering choice meant to limit losses during abrupt price moves. That mechanism was emphasized because the underlying token has recently shown large swings, compressing valuations in short order.

Jefferies acted as the lead arranger and bookrunner for the offering, running the paperwork, investor syndication and tranche pricing. Market participants view the trade as a first-of-its-kind bridge between consumer crypto lending and traditional securitization markets.

• The issuance creates a market reference for credit spreads on bitcoin-secured consumer debt.
• Automated collateral triggers are now part of the template for crypto-backed ABS deals.
• The financing provides immediate liquidity to Ledn, converting loan receivables into cash that can be redeployed.

Beyond the headline numbers, the transaction offers investors a tested set of playbooks: tranche waterfall, interest allocation and mechanical collateral enforcement. That playbook will influence how other lenders structure similar offerings and how institutional desks price this new asset class.

For retail borrowers, the deal means their loans remain on the originator’s books but now sit behind a securitization that transfers repayment risk to public investors. The securitization also creates a secondary market signal for credit and collateral performance in crypto lending.