Ledn Introduces Partial Liquidation for Bitcoin-Backed Loans Effective November 9, 2026

By 21Rates Press Desk

Ledn will introduce partial liquidation for its bitcoin-backed loans on November 9, 2026, according to the company's published Loan Partial Liquidation Terms, version 202610.01, which 21Rates reviewed on October 29, 2026. Under the new structure, a loan that reaches its liquidation threshold will no longer be closed in full by default. Instead, only the minimum collateral required to bring the loan back to a 65% loan-to-value ratio is sold, and the loan remains open.

What LTV means here

Loan-to-value, or LTV, is the ratio of the outstanding loan balance to the market value of the bitcoin pledged as collateral. If a borrower owes less relative to the collateral value, the LTV is low. As bitcoin's price falls, the same loan balance represents a larger share of the collateral value, and the LTV rises. At a high enough LTV, the lender's protection against further price declines thins, which is why lenders act at defined thresholds.

The mechanics

Per the published terms, when a loan reaches its contract-defined Liquidation LTV, Ledn sells the minimum necessary collateral to restore a 65% LTV. The loan stays open, and interest continues to accrue on the reduced principal. Proceeds from the sale are applied first to any applicable Administration Fee, then to unpaid interest, then to principal. Because fees and interest are paid first, not all proceeds immediately reduce principal.

There is no numerical limit on repeated partial liquidation events. If the remaining collateral value cannot restore the 65% LTV, collateral is liquidated toward the outstanding balance. Ledn also retains its rights to full or partial sale of collateral for other defaults. An email notice follows each event.

The 80% trigger and the old process

A customer email attributed to The Ledn Team, supplied to 21Rates, describes the change taking effect November 9, 2026. According to the email, a loan reaching 80% LTV will trigger a sale of enough bitcoin to restore 65% LTV while keeping the loan open. The email says this replaces outright closure at 80%, and describes the change as automatic for eligible new and existing loans, with no action required from borrowers.

Readers should note the sourcing distinction. The public partial liquidation terms do not print a numeric 80% trigger; they refer to a contract-defined Liquidation LTV. The 80% figure and the description of the prior outright closure process come from the customer email supplied to 21Rates, which 21Rates has not independently authenticated against a public Ledn announcement.

Material exceptions

The terms carry qualifications borrowers should read before relying on the feature:

• The terms apply to all loans, including those outstanding at the effective date, but the individual Ledn USD Loan Agreement identifies the counterparty and prevails in any conflict. The terms do not establish universal geographic eligibility.
• Uninterrupted systems are not guaranteed during volatility.
• Ledn may modify, suspend, discontinue, or amend the feature.
• The terms are governed by Cayman Islands law, with exclusive jurisdiction in Cayman Islands courts.

What borrowers should do

Borrowers with existing Ledn loans should read the full partial liquidation terms alongside their individual loan agreement, since the agreement controls in a conflict. Those still comparing lenders can review the 21Rates guide to borrowing against bitcoin, which covers how to compare loan structures, LTV thresholds, and collateral treatment before committing.

This report is based on Ledn's published legal terms and a customer email supplied to 21Rates.

Frequently asked questions

What is Ledn partial liquidation?

It is a change to how Ledn handles loans that reach their liquidation threshold. Instead of closing the loan, Ledn sells only the minimum bitcoin needed to restore a 65% LTV, and the loan stays open with interest accruing on the reduced principal.

When does Ledn partial liquidation take effect?

The published terms show an effective date of November 9, 2026, and were forthcoming as of October 29, 2026. The terms apply to all loans, including those outstanding at the effective date.

At what LTV does Ledn partially liquidate?

A customer email supplied to 21Rates says the trigger is 80% LTV, with collateral sold to restore 65%. The public terms do not print that number; they refer to a contract-defined Liquidation LTV, so borrowers should check their own loan agreement.

Does a partial liquidation pay down my loan principal?

Not entirely, at least not first. Sale proceeds go first to any applicable Administration Fee, then to unpaid interest, then to principal. The loan remains open afterward.

Can partial liquidation happen more than once?

Yes. The terms place no numerical limit on repeated events. If the remaining collateral cannot restore the 65% LTV, collateral is liquidated toward the outstanding balance.