#Ledn – a centralized cryptocurrency lending platform based in over 130 countries – is preparing to expand into California, as traditional financial institutions (TradFi) start to seriously enter the crypto market. With total assets under management reaching $1.5 billion, Ledn is betting that the wave of institutional entry will change the landscape of the crypto lending industry.
Big vision from the West
In a recent interview, Ledn's CEO and co-founder – Adam Reeds – revealed that the company has filed for a license to operate in California. This is seen as a strategic move to expand in the US, where regulations on crypto are gradually becoming 'softer' after former SEC Chairman Gary Gensler stepped down.
“The price of Bitcoin is rising and more people are owning Bitcoin – this justifies the compliance costs when expanding into new areas,” Reeds said.
Currently, Ledn has provided lending services in 39 states in the US, but has not yet officially operated in California and Tennessee – two potential large markets.
Confronting Wall Street giants
Ledn is not alone in this arena. Traditional financial names like Cantor Fitzgerald are also quietly building their own Bitcoin finance segment. According to Reeds, this is a clear signal that:
“From being a pioneering risk, crypto has now become a fear of being left out in the boardroom (boardroom FOMO). Cantor's competitors will have to ask themselves: 'Why haven't we done this yet?'”
The participation of large institutions will help lower capital costs, allowing Ledn to reduce interest rates for borrowers and expand its personal customer base – which currently accounts for 90% of the company's business.
Reviving after the storm of 2022
In 2022, the crypto lending industry witnessed a series of high-profile collapses like BlockFi and Genesis, causing turmoil across the industry. However, Ledn has weathered the storm and become one of the few remaining centralized platforms, alongside Tether – according to a report by Galaxy Digital.
By the end of last year, these three organizations held up to 90% of the total $11.2 billion in outstanding loans – a figure still far from the peak of $34.8 billion in 2022, but showing strong signs of recovery.
Global focus: Global South and financial equality
Interestingly, a large portion of assets on Ledn does not come from the US, but from the Global South – including many developing countries with weak legal systems and limited property rights.
According to Reeds:
“In many countries, borrowing is the privilege of the wealthy. But we want to change that – where you are born should not determine your access to capital.”
Users in these regions can mortgage digital assets to access capital, something that traditional banks do not easily provide.
Pressure from DeFi and changing borrowing trends
Although Ledn has recovered well, the centralized lending industry has not yet escaped the shadow of 2022. Zack Pokorny – an analyst at Galaxy – stated that increasing transparency is causing users to gradually shift to DeFi, which now accounts for up to 60% of the total borrowing volume in crypto.
DeFi lending platforms like Aave are becoming popular by using (wrapped) Bitcoin as collateral – similar to the core operating model of Ledn.
“Bitcoin is becoming the most popular collateral asset on Aave – the largest on-chain lending platform on Ethereum,” Pokorny said.
Impact on the crypto market and Binance users
The expansion of large organizations like Cantor Fitzgerald and Ledn into the crypto lending market could lead to lower fees, higher liquidity, and more financial options for users – especially those holding assets like Bitcoin but not wanting to sell.
Users on Binance – especially in countries with limited financial systems – could also benefit from the crypto-collateral lending model if Binance integrates or partners with similar entities. This could be a potential direction if Binance wants to expand its lending operations in emerging markets.
Conclusion
Ledn is making a big bet on the revival of the centralized lending industry and the increasing involvement of TradFi institutions. In the context of the crypto market gradually recovering and US policies becoming more 'loose', Ledn's expansion – particularly in #California – could be a sign that crypto lending is entering a new era: more professional, more competitive, and potentially serving a wider audience on a global scale.
⚠️ Risk warning
Investing in cryptocurrencies and related products always carries high risks and is not suitable for everyone. Users should carefully consider before participating in the market, and should not use borrowed funds or all their personal assets to invest. The crypto market can be highly volatile and there is no guarantee of profit.