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>presumably via exactly that sort of opaque, centralized exchange Obviously Erik did not mean via centralized exchanges. You can lend your Bitcoin on countless
by MacsHeadroom 4y ago
>presumably via exactly that sort of opaque, centralized exchange
Obviously Erik did not mean via centralized exchanges. You can lend your Bitcoin on countless decentralized protocols for those yields- even risklessly with flash loans via a dApp like Aave. With non-risk-free lending you can assess and knowingly accept your desired level of risk via fully auditable open ledgers.
- paulgb 4y agoIf I lend Bitcoin on a decentralized protocol, who has the private key to the wallet I transfer the Bitcoin to? At some point I'm still trusting a centralized bridge, right?
- MacsHeadroom 4y agoYou still hold the keys and can withdraw at any time. That's the point if non-custodial DeFi. If you withdraw more than your interest and in some other crypto than your collateral then your loan now has leverage. During that particular withdraw transaction you will have signed some logic which can automatically liquidate your lent crypto if the amount you withdrew (minus interest) becomes worth less than your collateral. Until that pre-signed liquidation transaction executes you are fully in control of the balance and keys.