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680 sats \ 2 replies \ @mo OP 18 Apr 2023 \ parent \ on: Bitcoin Loan VS Bitcoin-backed Loans: Pros & Cons bitcoin
I not know Sovryn was allowing BTC lending/borrowing directly, I'll check it out. I knew about Lend.HodlHodl.com that is actually just playing as facilitator more than intermediary (I though is an interesting approach)
So in the case of lending/borrowing BTC directly... it will make sense to do it only for long terms contracts, like over 5 years?
So in the case of lending/borrowing BTC directly... it will make sense to do it only for long terms contracts, like over 5 years?
I think moreso the opposite, it would only make sense on very short timescales. Long term we expect the BTC price to go up right? So we don't want to be short BTC long term. Even short term is risky haha but some people do make money shorting BTC.
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Hot take: hodlhodl's lending model is custodial
They use 2 of 3 multisig where you have a key, your counterparty has a key, and hodlhodl has a key
That means in all of these loans there is a group of 2 people (your counterparty + hodlhodl) who can pull the rug out from under you and run off with your money
They have the keys to your coins and can move them independently. You do not have the keys to your coins and cannot move them independently. That's precisely what custodial means: someone else has your money instead of you.
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