would

Morpho

Bitcoin

<p>Ledger (<a href="https://x.com/Ledger" rel="noopener noreferrer nofollow">@Ledger</a>) has added Crypto Loan to its wallet app, letting users borrow stablecoins against wrapped Bitcoin <a href="https://x.com/search?q=%24BTC&amp;src=cashtag_click" rel="noopener noreferrer nofollow">$BTC</a> without selling their holdings.</p>
<p>Eligible users can pledge <a href="https://x.com/search?q=%24WBTC&amp;src=cashtag_click" rel="noopener noreferrer nofollow">$WBTC</a> or $cbBTC as collateral to borrow <a href="https://x.com/search?q=%24USDC&amp;src=cashtag_click" rel="noopener noreferrer nofollow">$USDC</a> or <a href="https://x.com/search?q=%24USDT&amp;src=cashtag_click" rel="noopener noreferrer nofollow">$USDT</a>. Yield(.)xyz (<a href="https://x.com/yield_xyz" rel="noopener noreferrer nofollow">@yield_xyz</a>) handles the technical integration, while smart contracts from Morpho (<a href="https://x.com/Morpho" rel="noopener noreferrer nofollow">@Morpho</a>) manage the lending activity.</p>
<h2 id="how-ledger-s-crypto-loan-works">How Ledger's Crypto Loan works</h2>
<p>Ledger said in a press release dated Oct. 7 that Crypto Loan would roll out gradually to eligible Ledger Wallet users after its unveiling at TOKEN2049 Singapore. Within the app, users can open a loan, check the loan-to-value ratio, add collateral and repay the debt.</p>
<p>Ledger is not issuing the loans or acting as the lender. The app gives access to Morpho's onchain lending markets, while Yield(.)xyz handles the integration. Key actions are physically approved on a Ledger signer before they execute.</p>
<p>The collateral is not native Bitcoin. It consists of tokenized Bitcoin representations used in Ethereum-based lending markets rather than BTC held directly on the Bitcoin network. The USDC-cbBTC and USDT-WBTC markets each have an 86% liquidation loan-to-value ratio, according to TokenPost. Borrowing costs are variable and depend on conditions within individual Morpho lending markets.</p>
<p>Morpho powers the feature through Yield(.)xyz, the same provider Coinbase relies on for its own Bitcoin-backed loans, Yahoo Finance reported. The launch also extends Ledger beyond hardware wallets. It marks another expansion into financial services built around self-custody.</p>
<h2 id="liquidation-risk-remains">Liquidation risk remains</h2>
<p>Borrowing against crypto avoids a sale, but it does not remove the risk of losing the collateral. Keeping signing keys on a hardware device does not leave pledged tokens freely spendable, because collateral moves into Morpho smart contracts and can be liquidated if the loan becomes unhealthy.</p>
<p>When a position's loan-to-value ratio exceeds the market threshold, Morpho allows external liquidators to repay part or all of the debt in exchange for the collateral plus a liquidation bonus. Falling collateral prices or accumulating interest can make a position eligible. Ledger's own guide also notes that Bitcoin wrapping introduces custodians and conversion steps, and lists smart contract vulnerabilities and oracle failures as potential risks.</p>
<p>Availability is restricted to eligible users in supported jurisdictions. Borrowers should check the loan terms and keep a buffer below the liquidation threshold before opening a position.</p>
<h2 id="sources">Sources</h2>
<p><a href="https://crypto.news/ledger-adds-bitcoin-backed-loans-through-morpho/" rel="noopener noreferrer nofollow">crypto.news: Ledger adds Bitcoin-backed loans through Morpho to its wallet app</a></p>
<p><a href="https://www.tokenpost.com/news/business/27319" rel="noopener noreferrer nofollow">TokenPost: Ledger Launches Bitcoin-Backed Loans Through Morpho Markets</a></p>
<p><a href="https://finance.yahoo.com/markets/crypto/articles/ledger-launches-bitcoin-loans-letting-090103138.html" rel="noopener noreferrer nofollow">Yahoo Finance: Ledger Launches Bitcoin Loans, Letting Holders Borrow Without Selling</a></p>

Ledger Lets Bitcoin Holders Borrow Without Selling

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