What are Ledn Growth Accounts?
Ledn Growth Accounts allow you to earn interest on your digital assets (BTC, USDC, ETH, USDT) while maintaining flexibility to transfer assets in and out as needed. A Growth Account is ring-fenced to ensure you are only exposed to the credit risk of the counterparties that generate your interest, meaning it is isolated from the risks of other Ledn products and services, and it will not be affected in the unlikely event of a Ledn bankruptcy.
How does Ledn generate the interest it pays for Growth Accounts?
Ledn generates interest for Growth accounts in two primary ways:
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BTC and ETH Growth Accounts:
We work with institutional market makers who pay Ledn in return for borrowing BTC/ETH. These market makers use the borrowed BTC/ETH as collateral on exchanges where they provide market-making services or to settle trades in which BTC/ETH forms one leg of the transaction. Importantly, these institutions do not take a directional view of the market. All borrowers are rigorously vetted and continuously monitored by Ledn’s risk management team. We maintain a diversified list of these borrowers to mitigate the risk that any single borrower could negatively impact our operations.
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US Stablecoin Growth Accounts (USDC/USDT):
Interest for US stablecoin Growth accounts is currently generated primarily by lending to Ledn's BTC/ETH-collateralized retail loan book, which has a proven track record with no history of loan losses. This ensures a secure and reliable way to earn interest on your assets.
We do not use Decentralized Finance Protocols (DeFi) to generate interest, ensuring that client assets are not exposed to additional risks associated with these platforms.
For more details about how Ledn generates interest, including specific breakdowns, visit our Open Book Report on The Ledn Blog.
How is interest paid each month for Growth Accounts?
Interest is accrued daily based on your Growth Account balance. Interest is paid out in kind monthly, typically on the first day of the following month, and you can see your earned interest directly in your Ledn dashboard.
Is there a minimum balance required?
No, there is no minimum balance required to start earning interest in your Ledn Growth Account.
Where are the Growth Account digital assets stored?
When not on-lent to borrowers, Growth Account digital assets are primarily held in custody at Ledn’s custodial partners and banking partners for operational purposes, including we can process your withdrawals smoothly.
For more details, check our monthly Open Book Report.
Am I Exposed to Risks from Coins I Don’t Hold?
Our Growth accounts are ring-fenced to ensure you are only exposed to the credit risk of the counterparties that generate your interest. There is no commingling of different Growth account asset categories. This means, for example, that a BTC Growth account holder is isolated from the risks of any other Ledn products or services, including our ETH or USDC/T Growth accounts.
You are not exposed to the counterparty credit risk of USDC/T or ETH Growth Accounts unless you have assets in those accounts (i.e. you are a USDC/T or ETH Growth account holder).
None of our Growth accounts are exposed to Ledn insolvency risk.
Finally, you are in control and can easily opt in and out by transferring assets between our Growth and our non-interest earning Transaction accounts.