Bitcoin-Backed Mortgage Product To Launch in 2022 Thanks to $70 Million Funding Round

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In a Dec. 15 press release, Ledn, a Toronto-based digital asset savings and credit platform, announced it had just raised $70 million in a Series B funding round, bringing its valuation to $540 million. In addition, the company revealed the impending launch of a Bitcoin-backed mortgage product, the first product of its kind to hit the market, it said.

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The round of funding was led by 10T Holdings, and new investors include Golden Tree Asset Management, Raptor Group and FJ Labs.In addition, 10T Holdings’ managing partner and CEO Dan Tapiero will be joining Ledn’s board of directors, according to a statement.

Ledn explained in the statement that this mortgage product will enable its clients to use their Bitcoin holdings to purchase a property while continuing to benefit from potential price appreciation of both assets. Clients will be able to blend an equal amount of Bitcoin and property collateral as part of the mortgage loan. In other words, the “Bitcoin mortgage” allows people to access liquidity without needing to sell their assets. “You no longer need to decide between holding your Bitcoin or owning real estate,” according to Ledn’s website.

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“This unique collateral structure, which relies on the stability of real estate to buffer against the volatility of Bitcoin, was designed to provide clients with a generous window to service their Bitcoin collateral during times of high market volatility,” the company said in the statement.

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Currently in pilot mode, the Ledn Bitcoin-backed mortgage is slated to be made broadly available to clients in the U.S. and Canada by early 2022. The company already has a growing waitlist for the product, and is targeting more than $100 million in Bitcoin-backed mortgage originations by the end of Q1 2022.

“Most people that hold extensive wealth in Bitcoin still can’t utilize their assets to qualify for a mortgage at a bank,” Adam Reeds, co-founder and CEO at Ledn, said in the statement. “Our clients want to diversify their portfolio in order to protect their wealth and then utilize that wealth for instances such as purchasing a home, but one should not come at the expense of the other. That is why we are launching this product, in order to provide access to key financial products for those who choose to invest outside the mainstream of legacy banks.”

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About the Author

Yaël Bizouati-Kennedy is a full-time financial journalist and has written for several publications, including Dow Jones, The Financial Times Group, Bloomberg and Business Insider. She also worked as a vice president/senior content writer for major NYC-based financial companies, including New York Life and MSCI. Yaël is now freelancing and most recently, she co-authored  the book “Blockchain for Medical Research: Accelerating Trust in Healthcare,” with Dr. Sean Manion. (CRC Press, April 2020) She holds two master’s degrees, including one in Journalism from New York University and one in Russian Studies from Université Toulouse-Jean Jaurès, France.
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