Lending your Bitcoin to someone for a return? Why not? If someone wants to open a bakery and needs 2 Bitcoin, but only has one, you can lend him yours for a share of the profit of the bakery until your friend, with his share of the profit, can give you your Bitcoin back. In a larger sense, there may be pools of Bitcoin facilitated by enterprises…am I missing something?
nostr:npub1h8nk2346qezka5cpm8jjh3yl5j88pf4ly2ptu7s6uu55wcfqy0wq36rpev a good friend finally conceded I was right about #bitcoin today (I felt nothing). He did however bring up a query about how credit would work on a #BTC standard. My response is fundamentally credit doesn’t work in a deflationary environment. After a few beers and crossed eyes, I still stand by this statement. But is there a possibility for credit on a Bitcoin standard in your view? I can’t see how it works?
Discussion
So no “tradfi” interest rate, just share of profits. I think this is the crux of my mental dilemma. If there is interest applied where does it come from? I guess this is the fiat ponzi…
Exactly. “Interest” has to come from value creation. That’s how it all started under good standard as well. Banks held your savings. And when someone wanted to star a business, they could borrow the money. Pay it back from adding value, and the bank passed it through mines their take and paid the saver; however, when you print money, you can all the sudden make money with money itself.
Lending and borrowing at interest are already happening with DeFi. The interest rate on bitcoin is tiny. The trick is that you have to repay in bitcoin. Few people want to take the risk having to pay double in fiat terms.