Correct, this assumes you’re making fiat payments equivalent to the pump and slump values of BTC. The discount is basically achieved by you repaying a higher amount in fiat terms than what was provided to you. Generally, the market cap/discount rate will adjust so they earn a bit more BTC than the could have via DCA or a one-off purchase.
Login to reply
Replies (2)
The trade off lies in extreme scenarios. If BTC spikes, your investors are worse off. If BTC pukes, you are worse off. Overall, one doesn’t win at the expense of the other. Both win or both lose, just more or less relative to each other.
Mashallah! This sounds like an amazing service!
One last question, for today 😁. How is the collateral btc held? What assurances do borrowers have for their btc?