Digital asset banking group Sygnum has provided crypto lender Ledn with a $50 million Bitcoin-backed loan, described as the first loan of its kind.
The idea, according to an announcement Tuesday, is that Toronto-based Ledn – which offers interest-bearing savings accounts and bitcoin-backed loans – will use the money to expand its retail lending business. The firms say it is the first time a regulated bank has issued a bitcoin-backed loan.
“Sygnum is excited to support Ledn’s future growth with the first Bitcoin-backed syndicated loan from a fully regulated bank and to stimulate a new market for institutional lenders and borrowers as the crypto ecosystem matures,” said Benedikt Koedel, head of lending and loan origination at Sygnum, in Tuesday’s announcement.
Ledn CEO John Glover added that the loan was a “significant step forward in the integration of crypto assets into mainstream financial markets.”
The announcement said that the loan would give Ledn customers more flexibility in accessing capital while allowing them to use their bitcoins as collateral.
Founded in 2017, Sygnum claims to be the world’s first digital asset bank and manages assets worth over $4.5 billion.
The company holds a Swiss banking license and a capital markets license that allows it to operate and lend in Singapore. It is also subject to regulation in Abu Dhabi and Luxembourg.
Ledn announced earlier this month that it had processed $1.16 billion worth of digital asset loans, mostly to institutions, in the first half of this year.
