Growth Accounts

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:

• 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.
  
  
• 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.

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

How does tiered interest impact rates?

For some assets, interest rates are tiered, meaning that larger balances may earn higher rates. For example, the first portion of your balance might earn at one rate, while additional amounts above a certain threshold earn a higher rate.

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 48 hours, unless there is a non-performing loan, in which case your Growth Account may be temporarily locked for investigation.

Can I cancel a transfer?

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

For more details on transfer timelines and potential delays, visit our Open Book Report.

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

If Ledn identifies a non-performing loan with any of the counterparties that borrow digital assets to generate interest for our Growth accounts, we take immediate steps to protect our clients' assets. Here’s what happens:

1. Access to Unimpaired Funds:
   Growth account clients will still be able to access unimpaired funds quickly, ensuring that assets aren’t tied up in lengthy and complex bankruptcy proceedings.
2. Temporary Account Lock for Investigation:
   To ensure the safety and integrity of your assets, your account may be temporarily locked for the duration of our investigation. During this period, you will continue to earn interest on your holdings.
3. Outcome of the Investigation:
   • Once the investigation concludes and we determine the extent of any loan impairment, all unimpaired assets will remain accessible to you and will continue to earn interest.
   • You will be able to view the status of the recovery efforts for the impaired loan.
   • As we recover assets from the defaulted loan, we will distribute any recovered amounts back to affected Growth account holders on a proportional basis.
4. Risk of Loan Losses:
   While Ledn employs rigorous measures to safeguard client assets, it is important to acknowledge that loan losses may occur. IN THE EVENT OF AN IMPAIRED INSTITUTIONAL LOAN, LEDN WILL DO EVERYTHING IN ITS POWER TO RECOVER AS MUCH ASSETS AS POSSIBLE FROM THAT INSTITUTIONAL BORROWER. Any losses that cannot be recovered will be proportionately shared among all Growth account holders exposed to that counterparty.

Important Note:
Your Growth account is not insured or guaranteed by any entity. Unlike traditional bank accounts or guaranteed investment certificates, Growth accounts are not covered by government deposit insurance or other investor protection schemes.

Transfers between Transaction and Growth Accounts generally take up to 48 hours. This period ensures that your assets are secured and protected. If there is a loan under investigation, transfers may be delayed for security reasons.

Transfers can be canceled at any time before they are processed.

Ledn ETH Growth Accounts provide a simpler and faster alternative to traditional ETH staking. Instead of manually staking your ETH, you can quickly start earning interest by transferring your ETH to your Growth Account.

Benefits:

• Easy to transfer in and out.
• Avoid the technical setup and delays of staking.

ETH Growth Accounts are a great choice for those who want flexibility and control over their assets.

The Ledn Growth Accounts are available globally to holders of BTC, USDC, ETH, and USDT, with a few exceptions. You can check your country’s eligibility below.

Ineligible Countries: Afghanistan, Albania, American Samoa, Armenia, Azerbaijan, Bangladesh, Belarus, Benin, Botswana, Burkina Faso, Burundi, Cambodia, Cameroon, Canada, Cape Verde, Central African Republic, China, Democratic Republic of the Congo, Cuba, Eswatini/Swaziland, Eritrea, Ethiopia, Ghana, Guam, Guinea, Guinea Bissau, Haiti, Iran, Iraq, Jamaica, Jordan, Kazakhstan, Kyrgyzstan, Lebanon, Liberia, Libya, Madagascar, Mali, Mauritania, Mauritius, Mongolia, Morocco, Mozambique, Myanmar, Nepal, Nicaragua, Niger, North Korea, Northern Mariana Islands, Pakistan, Palestinian Territories, Puerto Rico, Republic of the Congo, Réunion, Russia, Rwanda, Senegal, Sierra Leone, Somalia, Sri Lanka, Solomon Islands, South Sudan, Sudan, Syria, Tajikistan, Tanzania, Timor-Leste, Tonga, Trinidad & Tobago, Tunisia, Turkmenistan, Uganda, Ukraine, United States of America, U.S. Minor Outlying Islands, U.S. Virgin Islands, Uzbekistan, Vanuatu, Western Sahara, Yemen, Zambia, Zimbabwe.

You can also check our Eligibility Page.