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We touched on the lending sector a few weeks ago, but I want to plug back in.
I caught up with Ledn’s Mauricio Di Bartolomeo, who told me that last quarter, Ledn did $304 million worth of bitcoin-backed loan originations.
“That’s three times the originations we did at the peak of the market in 2021,” he added. And “multiples” of what Ledn saw in 2024.
“The demand for borrowing dollars and keeping the bitcoin is growing [at the fastest pace since] it’s ever grown since we started this business in 2018,” Di Bartolomeo said.
Di Bartolomeo told me that the bulk of their customer base is retail, though they do have some institutional clients.
Demand has increasingly grown amongst individuals who’re sitting on millions of bitcoin — enough to retire — but still want to utilize that bitcoin to have access to the traditional banking system for things like mortgages.
This cycle, Di Bartolomeo says, the bad seeds have been weeded out — and people like former Celsius CEO Alex Mashinsky are now serving time for the crimes committed last cycle. However, he cautioned that folks should still be careful when it comes to lenders.
“I would say it’s the demand is exploding,” he said, but urged caution and diligence for folks looking to access lending markets. It’s not worth a sweetheart rate if the company doesn’t pass a vibe test.
Zooming out, Ledn isn’t the only one to see success so far this cycle. In a different sphere of the lending sector, Maple Finance is also seeing success with its institutional lending.
A Blockworks Research note this week said that “SYRUP offers an asymmetrical investment case in lending, driven by compelling valuation metrics relative to peers, solid growth avenues via the successful Syrup pools and the strategic istBTC initiative, a resilient team, and a completed vesting schedule removing early supply overhang.”
Maple and Ledn have very different target audiences, so I’m cautious to avoid any sort of comparisons, but I think they each offer a unique vantage point into the overall health of the lending sector.
The institutional lending bull case Blockworks Research sees as $250 million in loans outstanding by the fourth quarter, while the base case is $200 million by the same time period.
I wrote a few weeks ago that we’re starting to see a resurgence in the custodial lending market, and that certainly is playing out when looking at the numbers so far. It’s also interesting to gauge how different players in the space are faring — or finding success.
Not to mention that nowadays there are more options in the lending market than in previous cycles. Take, for example, noncustodial choices for bitcoin-backed loans with a DeFi tilt, which include tBTC, iBTC, LBTC.
The key, for me anyway, is to ensure that there aren’t historical repeats. If this market is going to be successful, it’s going to need to stay away from the shams of the past.
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