The first ever securitization of loans backed by Bitcoin might at first glance appear riddled with risk. But look more closely and protections in the structure may be enough to give investors comfort.

Ledn’s $188m deal, lead managed by Jefferies, parcels loans the US specialist lender makes to individuals and private companies against their Bitcoin holdings.

So far, so innovative — but the deal comes at a time when the Bitcoin price is cratering. It fell from $124,000 in October to around $63,000 on February 5. It was at about $67,100 on Wednesday when the Ledn deal was priced.

As GlobalCapital has previously reported, there are no credit checks on borrowers and they do not have to make any interest payments until they pay off the…