Bitcoin-Backed Loans | Ledn x Bitcoin Advisory
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Some asset holders borrow against assets.
Borrowing against assets is one strategy worth understanding, with real risks and tradeoffs.
A strategy worth understanding
Public examples often discussed include founders borrowing against equity rather than selling shares.
Some borrow against assets rather than selling, which can preserve exposure but adds debt and liquidation risk.
Selling and borrowing can have different tax and risk profiles. Talk to a qualified tax professional before using either approach.
Borrowing instead of selling is a tradeoff, not a free lunch.
The Strategy
Buy an appreciating asset
Stocks, real estate, Bitcoin — assets that grow over time
Borrow cash against it
Instead of selling, take a loan using your asset as collateral
Spend the cash, keep the asset
The asset remains exposed to upside and downside while the loan adds cost and collateral risk.
Different structures can create different tax, interest, and liquidation outcomes. Get qualified tax advice before using this approach.
Apply this to Bitcoin
Lose your position.
Pay taxes.
Keep every sat.
Get your cash.
The tradeoffs matter
Imagine someone holds 1 BTC and needs liquidity. The tradeoffs depend on price, collateral terms, taxes, and risk tolerance.
Hypothetical cash
Position reduced in this example
Hypothetical cash
Loan and liquidation risk remain
Why selling is the expensive option
Every sale is a taxable event. That's 20-30% gone immediately.
You lose your position in the scarcest asset on Earth.
Selling is permanent. You can repay a loan. You can't un-sell Bitcoin.
Loans are reversible. Sales are not.
When does this make sense?
You need liquidity but believe Bitcoin will appreciate
You want to avoid capital gains taxes
You have a large enough position to collateralize
You're comfortable managing loan-to-value ratios
This isn't for everyone — it's for people with conviction and a long time horizon.
The risks, honestly
If Bitcoin drops significantly, you may need to add more collateral — or face liquidation. This is real. It's not free money.
Understand your LTV ratio (loan-to-value)
Have a plan for drawdowns
Manage with position sizing and discipline
$10B+ in Bitcoin-backed loans since 2018
Collateral custodied — not lent out
No monthly payments required
Repay anytime, no penalties
Proof of reserves every 6 months
Available in 100+ countries
Institutional-grade lending
Not DeFi experimentation. Real Bitcoin lending.
Borrowing against Bitcoin is worth understanding.
Keep learning. Understand the tradeoffs.
Bitcoin-backed loan and collateral services since 2018.