Ledn CEO warns Bitcoin Treasury boom is fading

Ledn CEO and co-founder Adam Reeds’ confidence in Bitcoin, the leading crypto as a reserve asset, is unshaken. Still, he believes recent movements in the market signal a change for digital asset treasury (DAT) firms determined on stockpiling. 

“Bitcoin treasury companies have been an incredible innovation for the space. What may be fading is the ability to get a 3x return,” Reeds told The Block on Friday. “MicroStrategy in the last five years did 24X versus Bitcoin, which did 10X. I can’t see that happening again.”

Bitcoin Treasury boom cools as market cap slides below $4 trillion

Signs that the once red-hot Bitcoin treasury boom is cooling have been visible for over a week. Inspired by Michael Saylor’s Strategy playbook, many firms have rushed to load up on BTC, but some are now trimming their holdings or even buying back stock.

After crypto’s total market capitalization recently peaked at nearly $4.3 trillion, it slid below $4 trillion, with the combined market cap of DATs dropping under $150 billion. The aggregate value of Bitcoin treasuries also slipped from $165 billion a month ago to $134 billion, despite BTC’s price remaining relatively stable.

As earlier reported by Cryptopolitan, Bitcoin dropped 2.2% to about $115,000, while Ether slid 4% to below $4,300. Bitcoin had set a new all-time high of $125,514 just days earlier, and Ethereum came within $100 of its November 2021 peak.

The surge was fueled by strong institutional demand, led by crypto treasury firms. Strategy remains the most aggressive player, holding nearly $73 billion of Bitcoin. Strategy’s stock price, which reached a July high of about $455, has since fallen to around $359 as of Friday, while Tokyo-listed Bitcoin treasury firm Metaplanet has seen its shares plunge over 30% in the past month.

Saylor has never sold a token since his company began buying in 2020, making it the largest Bitcoin holder in the world. Others quickly copied his strategy, like Metaplanet, a Japanese hotel firm that shifted into Bitcoin and accumulated $2.2 billion, now down 50% since mid-June.

“What’s fading is the ability to create unique propositions,” Reeds said. “Most CEOs of digital asset companies claim their mission is to generate more Bitcoin per share than the market — but do they really have the management teams or capital connections to outperform the underlying asset?”

Still, broader market sentiment improved on Friday as the total crypto market cap rebounded above $4.1 trillion. Ethereum (+13.33%), Solana, and Dogecoin all rallied following Federal Reserve Chair Jerome Powell’s strongest signal yet of an upcoming interest rate cut.

Ledn expands with private wealth program amid growing demand for BTC-backed loans

Ledn, the Bitcoin-focused lending platform co-founded by Reeds, recently announced that it has processed more than $10 billion in loans to date. The firm also launched a Private Wealth program designed for high-net-worth individuals and institutions seeking to unlock liquidity from long-term BTC holdings without selling.

According to a press release, the program caters to clients with at least $250,000 in active loans. It offers benefits such as faster processing, personalized service, and access to dedicated account managers.

“Bitcoin-backed loans are going mainstream. Our most sophisticated clients are using them to fund everything from real estate to new businesses, while keeping upside exposure,” said Mauricio Di Bartolomeo, Co-Founder and Chief Strategy Officer at Ledn. “The Private Wealth program gives them the tools, speed, and trust to operate at scale.”

The launch arrives when Bitcoin-collateralized lending is gaining increasing interest from traditional finance companies. JPMorgan recently showed an interest in crypto-backed loans, underscoring the sector’s trend toward mainstream finance. Ledn says it has already established the infrastructure for custody, risk management, and loan liquidation to ramp up. 

The program offering includes preferential rates for loans $1m+, automatic loan rebalancing for loans when the collateral value increases relative to the loan for all clients, and private wealth clients receive an additional complimentary rebalance once per month, in addition to the standard feature. Ledn clients are also given access to the company leadership team and exclusive events.

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