Bitcoin-Backed Lending Eyes $1 Trillion in Decade
A $1 trillion market for bitcoin-backed lending is emerging within the cryptocurrency ecosystem. According to Ledn's research, this market has the potential to reach that figure within a decade due to strong borrower demand and institutional infrastructure development.
The key drivers behind this growth are long-term BTC holders who prefer to borrow against their position rather than sell it. This preference stems from tax asymmetry, as selling BTC generates capital-gains liability in most major jurisdictions, while borrowing does not.
Ledn's research highlights borrower demand from North America, Latin America, and the Middle East, with loan-to-value ratios typically set between 30% and 50%. The firm's customer base is composed of holders who acquired bitcoin years ago and have no intention of selling.