Earning with Ledn

What are Ledn Growth Accounts?
Ledn Growth Accounts allow you to earn interest on your digital assets (USDC and 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. This means your assets are isolated from the risks of other Ledn products and services and are not affected in the unlikely event of a Ledn bankruptcy.

How does Ledn generate the interest it pays for Growth Accounts?

Interest for USDC and USDT Growth Accounts is entirely generated by lending to Ledn’s bitcoin-backed retail loan book, which is overcollateralized and has a proven track record with no history of loan losses since inception. This provides a secure and reliable way to earn interest on your assets.

Ledn does not use decentralized finance (DeFi) protocols to generate interest, ensuring that client assets are not exposed to the risks associated with those platforms.

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. 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?

USDC and USDT are used to fund Ledn’s overcollateralized bitcoin-backed loan book. When not being loaned out, excess Growth Account digital assets are held in custody with Ledn’s custodial and/or banking partners for operational purposes, including to process your withdrawals smoothly.

Am I Exposed to Risks from Coins I Don’t Hold?

No. Growth Accounts are ring-fenced by asset type. This means that if you hold a USDC Growth Account, for example, you are not exposed to the credit risks associated with any other Growth Accounts or products.

None of Ledn’s Growth Accounts are exposed to Ledn insolvency risk.

You are always in control and can opt in or out by transferring assets between your Growth and non-interest-bearing Transaction Accounts.

What happened to BTC and ETH Growth accounts?

We have made the decision to simplify our product offerings to focus primarily on the loans that clients love. These changes are about clarity, confidence, and getting back to what sets Ledn apart. If your goals align with safe, transparent bitcoin-backed borrowing, you’ll find a platform now built entirely around that vision - with no compromises.

USDC and USDT Growth accounts will still be supported, as they play an important role as a source of funding for supporting the bitcoin-backed loans we offer. 

You can always find the latest interest rates for Ledn Growth Accounts on our Rates and Withdrawal Terms page. Rates vary depending on the digital asset and the balance in your account.

Ledn Growth Accounts are currently available only for USDC and USDT. Please note that these accounts are subject to regional availability and restrictions may apply depending on your country of residence.

How does tiered interest impact rates?
For some assets, Ledn uses a tiered interest structure, meaning different portions of your balance may earn different rates. This approach helps reward larger balances while ensuring everyone earns a base rate on their holdings.

Example for USDC:

• Tier 1 (up to 100,000 USDC): 8.00% APY
• Tier 2 (100,000+ USDC): 10.00% APY

Transferring assets between your Growth and Transaction Accounts is quick and easy:

1. Log in to your Ledn account on the web platform.
2. Navigate to either your Growth or Transaction Account.
3. Select "Earn Interest" to move assets into your Growth Account and start earning interest.
4. Select "Withdraw" to move assets from your Growth Account back to your Transaction Account.
5. Transfers are processed within 15 minutes.

Can I cancel a transfer?

Yes, transfers can be canceled at any time until they are fully processed.

What is tiered interest?

Ledn Growth Accounts offer tiered interest, meaning larger balances earn higher interest rates.

How does tiered interest work?

Interest is calculated as a weighted average, with different tiers applying to different portions of your balance.

Blended Rates Example (for USDC):

• 100,000 USDC = 8.50% APY
• 250,000 USDC = 9.40% APY
• 500,000 USDC = 9.70% APY

Now that Ledn does not partake in third party institutional lending, this is no longer a risk. The USDC and USDT from the Growth Accounts is only used to fund Ledn’s overcollateralized loan book or for operational purposes. You can rest assured that the Growth Accounts funds are not exposed to the risks that come with third party institutional loans. 

There is currently up to a 15 minute delay for transfers which is the minimum amount of time our technology can support for this type of transfer. 

If you change your mind during the 15 minute transfer time, transfers can be canceled at any time before they are processed.

A Dual Cryptocurrency Note (DCN) allows you to earn a high, fixed-term interest rate on your BTC or USD, with a potential sell of your BTC or purchase of BTC at a predetermined target price (the "Strike Price") on a specific date in the future.

What are the components of a DCN?

You can pick between BTC to USD and USD to BTC DCN pairs. There are two components to each DCN pair:

1. Term Return:
   This is the amount of BTC or USD interest you will receive at the maturity of your DCN. The Term Return amount doesn’t change based on the BTC price at maturity and is paid in the original digital asset of your DCN.
   
   
2. DCN Outcome:
   • BTC to USD DCN: You set a Strike Price where you’d be happy to sell your BTC for USD. There are two possible outcomes:
     • If the BTC price at maturity is at or below the Strike Price, you’ll receive your original BTC amount back.
     • If the BTC price at maturity is above the Strike Price, your BTC amount will be converted into USD at the Strike Price.
   • USD to BTC DCN: You set a Strike Price where you’d be happy to buy BTC using your USD. There are two possible outcomes:
     • If the BTC price at maturity is at or above the Strike Price, you’ll receive your original USD amount back.
     • If the BTC price at maturity is below the Strike Price, your USD amount will be converted into BTC at the Strike Price.

Note: USD funds will be funded and returned in USDC on a 1:1 basis through your Ledn USDC Transaction account. In certain circumstances, you may receive your funds back in USD. Please refer to the Dual Cryptocurrency Note Agreement for more details.

What is the BTC Reference Price, Strike Price, and BTC Price at Maturity?

• BTC Reference Price: This is the price of BTC, in USD, which is pulled from our third-party liquidity provider. It is a reference point to help you evaluate DCN options.
• Strike Price: This is the agreed-upon, pre-determined price of BTC, in USD, which will be compared against the BTC price on the maturity date to determine the outcome of your DCN. It is selected when you take your DCN.
• BTC Price at maturity: This is the price of BTC, in USD, at the time of maturity for your DCN. It is a reference price that when compared against the Strike Price determines the outcome of your DCN. This price is supplied by our third-party liquidity provider.

What is the difference between annualized yield, term yield (%) and term return?

• Annualized Yield: The annualized yield is the equivalent effective annual interest you would earn if the term of the DCN was 1 year. It is shown for reference only.
• Term Yield (%): Term yield (%) is the interest you will earn over the term of your DCN, expressed as a percentage.
• Term Return: Term return is the amount of BTC or USD interest you will receive upon the maturity of your DCN. You will earn this amount in the original DCN digital asset regardless of the outcome of your DCN.

Is there a minimum amount required to contract a DCN?

Yes. The current minimum per DCN is 0.10 BTC or its equivalent in USD. 

Can I cancel a DCN before it reaches maturity?
No, you cannot cancel a DCN once it has been placed.

When your DCN matures, three things happen:

1. The BTC Price at maturity is compared against the Strike Price. There are 2 possible outcomes for each DCN pair:

• For a BTC to USD pair:
  i. If the BTC Price at maturity is at or below the Strike Price, you’ll receive your original BTC amount back.
  ii. If the BTC Price at maturity is above the Strike Price, you’ll receive your BTC converted into USD at the Strike Price.
• For a USD to BTC pair:
  i. If the BTC Price at maturity is at or above the Strike Price, you’ll receive your original USD amount back.
  ii. If the BTC Price at maturity is below the Strike Price, you’ll receive your original USD amount converted into BTC at the Strike Price.

2. Once the outcome is calculated, we’ll deposit the funds into your BTC or USDC* Transaction account.

3. Regardless of the DCN outcome, we’ll deposit the Term return into your BTC or USDC* Transaction account. The Term return is paid in the original digital asset you took your DCN in.

* USD funds will be paid or returned in USDC on a 1:1 basis through your USDC Transaction account, subject to certain circumstances in which you may receive your funds back in USD. Find out more details in our Dual Cryptocurrency Note Agreement.

For more details, review the DCN Agreement.

The benefits of a DCN are the ability to earn a higher interest than is available in your Ledn BTC Growth or USDC Growth accounts and gain advantage from your market view on BTC. 

• By picking future BTC prices at which you’d be happy to buy or sell BTC, you’re able to automate your outlook and either sell at a higher price or buy at a lower price than the existing one when you took your DCN.
• Regardless of the outcome, you’ll earn an interest  that is higher than what’s available in the Ledn BTC Growth or USDC Growth accounts, helping you build passive income.

There are risks associated with selling, buying or holding digital assets or entering into a DCN transaction with Ledn. You should understand these risks involved before taking a DCN. Some of the risks associated with a DCN are:

• The amount of BTC or USD you used to take your DCN are locked for the duration of your DCN.
• For a BTC to USD DCN, if the BTC Price at maturity is above the Strike Price, you’ll sell your BTC at a price that’s lower than the BTC Price at maturity.
• For a USD to BTC DCN, if the BTC Price at maturity is below the Strike Price, you’ll purchase BTC at a price that’s higher than the BTC Price at maturity.
• If your DCN amount is converted upon maturity, you may be subject to a taxable event depending on the jurisdiction in which you reside. Please consult a tax professional in your local jurisdiction for advice on proper tax treatment. 

For more information, please carefully review the DCN Agreement and its Risk Disclosures.