Ledn has recently raised $70 million in an all-equity Series B funding round. The funding round was led by 10 holdings, and other participants were Raptor Group, Golden Tree Asset Management, FJ Labs. The company is now planning to use the raised amount to launch Bitcoin-backed mortgages. Ledn is also planning to use the funds to bring in more staff, develop new digital assets and financial products.
The Bitcoin-backed mortgages
The idea of Bitcoin-backed mortgages is fascinating. Let’s say you are a Bitcoin holder in need of money. You invested in BTC when it was $3,000, and now it is at $50,000. If you sell your coins and take profit for the money you require, then you will have to pay capital gain tax on the same. A smarter way to deal with the situation is to take advantage of a Bitcoin-backed mortgage or lending program where you will lend your Bitcoin for a loan and, upon repayment, get it back.
This is not a new idea, but in the cryptocurrency space, it is a very common way to get money without having to book profits. The Ledn Bitcoin-backed mortgage will be available to a selected group of people in the US and Canada in 2022, and its waitlist is continuously growing. Do note that the only collateral in the loans won’t be Bitcoin. As part of the loans, one would also need to blend in other assets, most probably property.
Bitcoin-backed mortgages show a very good example of the benefits of debt. When used to one’s advantage, they are very powerful and can help you save a lot of money. In this case, we can see that debt is used to save the tax that one would need to pay otherwise. So, we cannot say that debt is a bad thing because the bad part is referred to as “bad debt.” This is the one where you are the one paying interest on money borrowed by you.
What is your thought as Ledn raises money to launch Bitcoin-backed mortgages? And do you think that the idea of taking loans to save tax is fascinating? Let us know in the comments below. Also, if you found our content informative, do like and share it with your friends.