Ledger launches USDC and USDT loans backed by Bitcoin
Ledger has launched its Crypto Loan feature, allowing Bitcoin holders to borrow stablecoins without selling their assets. Users can provide cbBTC or wBTC as collateral and borrow USDC or USDT directly through the Ledger Wallet app.
According to Decrypt, the new feature was unveiled at the TOKEN2049 conference in Singapore. It is powered by decentralized lending protocol Morpho through infrastructure provider Yield.xyz, which is also used by Coinbase for Bitcoin-backed loans.
Crypto Loan follows a self-custody model, meaning users do not need to transfer their funds to a centralized lending platform. Key operations require physical confirmation on a Ledger device.
Users can manage loans through Ledger Wallet
The app allows users to open a loan, monitor the loan-to-value ratio, add collateral, repay debt or increase the amount borrowed. Private keys remain under the owner's control throughout the process.
Ledger has also added direct connectivity between its devices and Morpho without requiring browser extensions or third-party software wallets. The integration connects the new lending service with Ledger's Earn product, allowing stablecoins deposited through it to help fund loans on Morpho.
For Bitcoin holders, the model provides access to liquidity without having to sell their assets. However, the collateral may be liquidated if its value falls sharply.
Ledger says its devices secure nearly 30% of Bitcoin held by retail investors. The launch of Crypto Loan marks another step in the hardware wallet maker's expansion into broader financial services.
Ledger expands financial capabilities of its devices
The lending feature is the latest step in the development of Ledger's ecosystem following an update to its app interface. The company brought together crypto purchases and swaps, asset management and access to decentralized applications within the app.
This approach is gradually transforming Ledger Wallet from a tool primarily used for asset storage into a single access point for a range of crypto transactions. Transaction approval still takes place through the user's hardware device.
Earlier, we reported that Ledger unveiled a new device for transaction approval alongside an updated crypto wallet. The company positioned the products as an alternative approach to standard digital asset security models.
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