Ledn Drops Ethereum, Embraces Bitcoin-Only Custody Model

On May 23, 2025, crypto lender Ledn it will stop supporting Ethereum (ETH) and shift entirely to a bitcoin-only lending model. The move takes effect on July 1, 2025, and comes as part of a broader strategy to simplify services and minimize risk.

Ledn stated that it will no longer use client assets to generate yield. Instead, it will adopt a full custody model. This approach means users’ bitcoin will either remain in direct custody or with trusted custody partners, removing intermediaries and lending loops from the process.

The decision reflects Ledn’s response to rising competition in the BTC-backed loan sector. It also signals the company’s commitment to reduce client exposure to lending risks that led to past collapses in the crypto lending space.

Unlike many centralized crypto lenders, will now avoid lending out customer assets to generate interest. In 2022, major platforms like Celsius, BlockFi, and Voyager failed due to risky lending practices involving customer deposits. Ledn’s updated policy aims to prevent such outcomes by eliminating third-party exposure.

The firm that under the new model, it will hold 1:1 reserves for all bitcoin used in loans. This structure limits potential default risk and aligns with Bitcoin’s original principles of financial self-custody and transparency.

The removal of ETH and the shift to full bitcoin custody also align with regulatory trends. Ledn appears to be positioning itself for stricter compliance standards as regulators worldwide increase scrutiny on digital asset management.

Ledn’s bitcoin-only model is designed to appeal to users seeking safer custody options in the lending market. As the platform moves away from yield farming and diversified altcoin services, it doubles down on BTC as the primary store of value.

Rising institutional interest in BTC has pushed demand for secure lending options. By focusing solely on Bitcoin, Ledn aims to differentiate from competitors still offering multi-asset services and yield-based products.

This strategy also reflects the growing divide between platforms prioritizing yield and those emphasizing custody and security. As more users grow cautious of leverage-based lending, Ledn’s model may appeal to a broader base of Bitcoin-maximalist clients.