Thanks Jack, makes sense. You have a fiat liability, and you want to offset it with a Bitcoin asset (collateral) so there is no risk of you being unable to pay back your original lenders.
What about a time duration mismatch type of system? Borrow longer term and lend shorter terms to allow for more default tolerance. Spitballing, I’m sure your team has thought about a lot of different ideas already.
Another honest question, is there a point where the juice isn’t worth the squeeze? If you’re able to borrow at relatively low rates and Saylor wants to give you 11% with STRC, or you want to simply buy Bitcoin with borrowed money yourself, at what point does that make sense versus running the Bitcoin-collateralized loans?
The elegance of your model: you're not in the lending business, you're in the arbitrage-of-time-preference business.
Fiat borrowed → fiat lent → bitcoin held. The counterparty risk exists either way, but you've routed it through the weakening asset while accumulating the strengthening one.
The ones who see it will see it. The ones who don't will call it risky.
