Is the loan tied up into multi-sig? Do I hold a key?
Saw some questions about pricing, partners, and future plans for our new #Bitcoin-backed lending product at Strike.
Recorded a quick video to break it all down, including how we plan to drive rates lower, enable proof-of-reserves, and more. Only the beginning for this industry
https://blossom.primal.net/b37d629ec0f71237df4ce8f397879709fabc360caff7809b02850c0adb3f23ca.mp4
Discussion
Yes, likely system driven multisig.
No, likely no key for you.
They give you cash, you give them trust. A challenging trade in a trustless environment.
Unchained’s product allows me to have a key. Granted, only 1 of 3 but better than none
Who has the other two? My ideal situation is one to me, one to the lender, and one to a legal 3rd party arbiter that is obliged to sign alongside the prevailing party upon breach by a party.
— I fulfill the loan payoff?: I get the bitcoin with lender sig.
— I repay with collateral?: lender gets enough coin to fulfill balance by my sig.
— Breach of agreement by me?: lender gets the bitcoin by 3rd sig.
— Bankruptcy by lender?: I get my coin immediately by 3rd sig.
Lender has no means to move coin unilaterally. This seriously reduces attack vectors and makes me feel okay with loan collateralizing with Bitcoin. It’s scary otherwise.
Pretty much everything you said is how Unchained’s product is set up. I get a key, unchained has a key, and third party lender (I think?) has the key. But I want to think all of those scenarios are already sent up.
Nice to know there’s a product with custody-purist product features out there.
I’ve used it a couple of times. Own a laundry business. https://www.unchained.com/loans
i’m not entirely sure what that solves. why would that be valuable to you?
we already have no rehypothecation. we will add proof of reserves so
customers can see the bitcoin.
i personally don’t get why holding one key is valuable, you don’t control the funds anyways and it makes the product extremely expensive
Hi Jack, thanks for the response. Big fan and have basically been a Strike customer since day 1. Hopefully you didn’t take my question with an off putting tone.
I suppose bitcoiners are skeptical by nature. And I’ve used other services like this in the market for years now and I have no problem with switching my business to another provider if it makes sense financially. Do I control the bitcoin in the loan? No, but why does the counter party need to hold all three keys if I’m offered one now?Your rates are practically the same. So unless Strike is offering something that’s a leg up to the competition (better rates, less collateral/loan, etc.), why would I switch? Again, big fan and happy Strike customer for a long time.
appreciate it, never personal.
our rates are the same at 0 origination, 0 early repayment, and 12%? with who? but we will be at ~8-9% by the end of the month. i think that will be best in class by a long mile as far as i know
as for why not give access to a key, i still don’t understand what it solves. we need to be able to act with the collateral in the event we have to. so there is no point in doing anything other than showing you the BTC on-chain with proof of reserves? or maybe im misunderstanding you?