Ledger launched a Bitcoin lending feature, allowing users to collateralize BTC to borrow stablecoins

Ledger launched its self-custody lending feature Crypto Loan at the TOKEN2049 conference in Singapore, allowing eligible users to collateralize wrapped Bitcoin cbBTC or wBTC in the Ledger Wallet to borrow stablecoins USDC or USDT, without needing to transfer funds to a centralized lending platform or sell their holdings. Users can open and manage loans directly within the wallet, track loan-to-value ratios, add collateral, make repayments, or increase borrowing, with key operations requiring physical confirmation on the Ledger signing device before execution.

This feature is supported by the decentralized credit network Morpho, with technology provided by Yield.xyz, which is also the supplier of Coinbase's Bitcoin collateralized loans. Ledger also announced that its signing devices can directly connect to Morpho without the need for a browser plugin or software wallet. Morpho co-founder Paul Frambot stated that this integration creates a "powerful liquidity flywheel," where stablecoins deposited through Ledger's existing Earn products can fund current loans for Bitcoin holders.

This move pushes Ledger, known for its hardware wallets, further into the financial services sector. Coinbase recently launched fixed-rate Bitcoin collateralized loans after expanding to UK users, and JPMorgan is also exploring Bitcoin and Ethereum collateralized lending. Ledger claims to have protected nearly 30% of the Bitcoin held by retail investors. Crypto Loan has begun to gradually open to eligible users, with availability expanding over time.