Bitcoin Becomes First Ever to Receive S&P Rating, Emerges as Prime Collateral on Wall Street

▲ Bitcoin (BTC), Wall Street/ChatGPT-generated image

Bitcoin (BTC) has been recognized as a core collateral asset in traditional financial markets, marking a new historic milestone in the integration of virtual assets with institutional capital markets.

According to cryptocurrency media outlet Cointelegraph on February 19 (local time), digital asset lending platform Ledn successfully issued approximately $188 million worth of asset-backed securities (ABS) backed by Bitcoin in the mainstream bond market. The transaction is being regarded as a symbolic event representing the incorporation of virtual assets into institutional finance, as it is the first Bitcoin-backed ABS to receive a credit rating from the global rating agency S&P Global Ratings.

S&P Global Ratings assigned a ‘BBB- (sf)’ rating to the $160 million senior Class A notes and a ‘B- (sf)’ rating to the $28 million subordinated Class B notes. A BBB- rating is the lowest tier of investment-grade status, indicating that the issuer has sufficient capacity to meet its financial obligations. The deal was underwritten by Wall Street investment bank Jefferies Financial Group, offering institutional investors a new Bitcoin-based investment opportunity.

The underlying assets of the ABS consist of 5,441 short-term fixed-rate loans issued to 2,914 borrowers in the United States, secured by a total of 4,078.87 BTC. André Dragosch, Head of European Research at digital asset research firm Bitwise, stated that the issuance demonstrates that “Bitcoin is increasingly being recognized by traditional financial institutions as safe and legitimate collateral,” adding that Bitcoin is being integrated as a new high-quality collateral asset within institutional finance.

Bok Jin-sol, Research Team Lead at crypto research firm Four Pillars, projected that the ABS issuance will significantly expand liquidity in the Bitcoin-backed lending market. “Unlike real estate monitoring, Bitcoin-backed loans can be transparently tracked on-chain and liquidated programmatically,” Bok explained, noting that these characteristics enable more effective risk management during the securitization process.

Founded in 2018, Ledn has issued $9.5 billion in loans across more than 100 countries to date and secured strategic investment last November from Tether, the issuer of the stablecoin USDT. The successful issuance of this Bitcoin-backed ABS once again demonstrates that digital assets have moved beyond mere speculative instruments to become core assets in financial products trusted by institutional investors.

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