Company Name: January
Founders: Mauricio Di Bartolomeo and Adam Reeds
Date established: September 2018
Head Office Location: N/A (totally isolated)
Number of employees: 51
Website: https://ledn.io/
Public or private? Private
“Lending is the type of relationship where you value the product from your asset more than the product forward your property.”
This was Di Bartolomeo's response when I asked him what is set Januarybitcoin and crypto lending and borrowing platform, as well as its competitors, including now-defunct companies offering similar services BlockFi, Celsius and Voyager.
“There is no company in this space that has a better track record of returning your funds than Ledn,” Di Bartolomeo told Bitcoin Magazine.
Since its inception, Ledn has prioritized security and reliability. Di Bartolomeo and his co-founder, Adam Reeds, have not only wanted to earn the trust of the traditional financial institutions with which Ledn interfaces, but also Ledn's global user base , some of them having access to financial services for the first time thanks to the company.
And Di Bartolomeo's work is very personal to him in part because he understands the importance of Bitcoin as a result of his own experience with his home country of Venezuela.
Di Bartolomeo's Bitcoin Tour
“My family discovered Bitcoin and started mining it in Venezuela in late 2014/early 2015 in the middle of hyperinflation where it was illegal for them to buy or hold US dollars or anything that holds value ,” said Di Bartolomeo.
“When I saw how they and other Venezuelans were using Bitcoin to withdraw from their broken system, I thought to myself “How many people in the world live like this and how many people in the world are going to need this? “And my answer was a number I couldn't figure out in my head,” he said.
Di Bartolomeo decided to start working in the Bitcoin space soon after. He moved to Canada where he and Reeds began helping miners to grow their operations. Di Bartolomeo recalled that these miners wanted to expand but did not want to sell their bitcoin to do so.
“They had bitcoin income and fiat expenses, and there was no real place for them to get funding,” Di Bartolomeo said.
“We were looking for funding, but nobody would give us a loan. So, we decided to solve our own problem,” he said.
“That was the origin of Ledn. “
How Ledn distinguished himself
When Ledn was founded in 2018, there were only a few other services like it. However, there was a distinct difference between Ledn and his competitors.
“There were other bitcoin-backed lenders on the market, but they needed tokens,” Di Bartolomeo said.
“This was about it There was an ICO and we saw Nexus and Celsius enters the space with signs. My view was that they were only using them to raise money without selling equity,” he said.
Di Bartolomeo and Reeds did not want to issue a signal, as they saw it as a questionable practice from a regulatory point of view.
“When you look at finance at scale, you immediately think of compliance and regulation,” Di Bartolomeo said. “We wanted to build a company that could sit in front of BlackRock or Goldman Sachs, highly regulated banks, and say, 'Hey, I want to interact with you guys.'”
In addition, Ledn prioritized transparency. In 2021, it became one of the first major Bitcoin companies to issue a verification of reservesa system that allows anyone to check bitcoin holdings at Ledn.
“We are still the only lender operating in the US or other highly regulated markets that has this proof of reserves where our customers can come and check every six months,” said Di Bartolomeo. “We've been doing this ever since it was cool. “
Ledn also publishes monthly Open Book Report which breaks down Ledn's lending strategies.
From early on, Di Bartolomeo believed that a concise and transparent approach would inspire confidence among Bitcoin enthusiasts, a group that lives with the “don't believe, prove” mantra, and his thesis has played out.
Risk Reduction
of the many products offered by Lednone of them is yield generation on bitcoin – the same type of yield that caused BlockFi's demise.
However, Ledn approaches his version of this product in a different way than his former competitor.
“We will generate Bitcoin returns on bitcoin primarily by lending it to market makers who arrange BlockRock IBIT ETF and units of Coinbase spot,” said Di Bartolomeo.
“These groups are price neutral. They do not have a directive disclosure. They are simply closing price gaps and benefiting from volatility,” he said.
BlockFi's approach was far more dangerous.
“With BlockFi, there was a long mismatch,” explained Di Bartolomeo.
“They were taking long-term investments, and they were using them in mining infrastructure that had a five-year payback. What do you think is going to happen when someone shows up before the five years are up?” he said, referring to the idea that BlockFi's fate seemed inevitable.
In addition, Ledn only deals in highly liquid assets such as bitcoin (and ether, which they added in 2023), which helps reduce the risk of asset liability imbalances.
“With bitcoin, people are always on both sides of the house with demand,” said Di Bartolomeo.
“When you start backing things like Shiba Inu or Dogecoin and people want to earn interest on those, you have to convert that Dogecoin into something else, and you create an asset liability imbalance in the process,” he said. .
Di Bartolomeo also noted that all of Ledn's products are individually packaged.
“When you're paying for a custody loan, you're not exposed to the credit risk of our other products,” he said. “This is very similar to how traditional finance works, and it's something we do very differently compared to our now defunct peers.”
Competition is growing
As more people begin to view bitcoin as “pristine alignment” more bitcoin lending and borrowing platforms are about to emerge. Many already have.
Central bitcoin lending and lending services like Salt and Nexo are still competitors to Ledn, while institutional bitcoin financing services like Newmarket Capital Battery Finance also ready to cut into the Ledn business. And services that allow users to borrow against the bitcoin in a carefree way, including Debbie and Lavathey can also increase their market share.
Di Bartolomeo is aware of the competition but doesn't seem to care. In fact, he believes that the consumer is the biggest winner in such a market, and he has no plans to change Ledn's strategy. Instead, he's looking to duplicate what Ledn does best.
“Our sweet spot is individuals or people who prioritize transparency, financial security and compliance,” Di Bartolomeo said.
“Safety, trust and transparency are what make Ledn stand out. There is no other operator like us in this area with an equal track record in terms of loans processed, years in the business and cycles,” he said.
“This business is changing. You have to have the right knowledge and the right set of values to empower your team, and I think other companies would be hard pressed to show what we have over the time ' we have Will you be able to find something cheaper? There are. Will that be more dangerous? Absolutely.”
Fostering Financial Inclusion
One of the main ways in which Ledn differs from traditional lending and borrowing platforms is that its rates do not differ based on the jurisdiction in which the lender or borrower is located.
“This makes people feel very empowered because they know that whether they're in Madrid or Medellín, they're getting the same rate,” said Di Bartolomeo.
And Di Bartolomeo smiled from ear to ear while discussing this point, as it seemed to remind him why he got involved in Bitcoin in the first place.
“It's one of the things that makes me proud of this business,” he said.
“We have people back in Latin America who have come to us to say that we are the first loan they have ever received. This is because we only look at 'Have you completed KYC?'; 'Are you a compliant citizen?'; 'Do you have Bitcoin?,'” he said.
“Not 'Where do you live?' it is; 'Who are your parents?'; What color is your skin?' I love this side of Bitcoin and what we do. “
