I think I prefer British Hod’s play on $MSTY over giving BTC to a third party like Ledn for a 12% loan.

Why?

1. Rehypothecation: While Ledn offers both a non-rehypothecated interest charge and a rehypothecated interest charge the fact that the former is on the table introduces a greater amount of trust.

And non-rehypothecation platforms like Unchained & Strike won’t give loans <100K.

While everyone’s stack size may vary, the high barrier to entry to non-rehypothecated lending platforms pushes lay bitcoiners to platforms requiring higher amounts of trust. Insert Terra Luna, 3AC, FTX, what’s next? Human greed won’t change.

If lenders want to rehypothecate BTC they should be absorbing some of the downard volatility risk and pricing that into their interest rates. If you go with Strike or Unchained you’re parting with 200K of BTC just to get started, excluding backup BTC for patching LTV slippage.

4. BTC Yield: Companies like Strategy increasing the amount of bitcoin per share for $MSTR, while dilluting the amount of shares overall, are gene-splicing bitcoin into Trad-Fi. This leads to fancy offspring like preferred stocks $STRK & $STRF which pay an 8% & 10% APY quarterly.

The ocean of liquidity just gaining access to what in effect are behaving like BTC Bonds — tapped by up-till-now untapped liquidity pools which are regulated by US markets — is the tip of a titanic iceberg.🧊

5. Insert $MSTY: Ever since options trading was enabled on the world’s most pristine, liquid, and volatile asset people could arbitrage its swings and turn a profit. People sell “covered calls” which just means they protect themselves on either side of a trade and make money.

Non day traders can’t do this so well but Strategy turned the ability to arb its own stock’s volatility into an ETF $MSTY that pays dividends monthly (with the involvement of risk), which range from 5%-15% over the last six months. Higher risk higher reward. Fueled by volatility.

BACK TO THE ORIGINAL POINT: Are bitcoiners better off dethawing a gank (or all) of their COLD SATS to get a loan they need to PAY BACK in full plus interest in a year OR selling 10% of their stack now to purchase income generating stocks fueled by bitcoin? 🤔

Most bitcoiners barely have a chair. Why should we pay interest to get fiat when there are options to start earning income on a small fraction of the BTC we’d have to fork out to get a loan? Plus, when we buy $STRK, $STRF, or $MSTY we get income to reinvest, live, and not owe.👑

🚨There is clearly higher risk in Strategy’s stocks than non-rehypothecated bitcoin but few have 200K in BTC to qualify plus extra to backstop it, AND want to pay 12-15% interest on top of that, which they have to earn to cover, as well as repay the loan.🚨

🎶 While BTC loans will remain on a steady downward slope towards accessibility to the lay bitcoiner (with ever-more competitive terms), the prospect of earning income, which can be spent or redeployed monthly or quarterly, while owing nobody ever, feels like the smarter play. 🎶