Hello Built on Bitcoiner
The newsletter is officially back. Time to warm up these Twitter fingers. Starting with giving you early access, a week before everyone else, to the latest podcast episode.
We're joined by Matthew Black and Jay Patel, the founders of Lygos Finance, to discuss the future of non-custodial Bitcoin-backed loans. Especially relevant on the heels of the Lava custodial lending switcharoo.
Matthew is an OG in the space, having previously built Atomic Finance (originally Atomic Loans), while Jay brings deep institutional experience from his time building lending products at Anchorage. Together, they are tackling one of the Holy Grails of Bitcoin finance: How to borrow against your Bitcoin without handing over your keys to a centralized black box.
As a subscriber to the newsletter, you're getting exclusive early access to this episode a full week before it's released to the public.
What You'll Learn
The "Non-Custodial" Nuance: We dig into the weeds of what "non-custodial" really means. Is it truly trustless? (Spoiler: If you’ve been following us, you know there’s an oracle involved, but this answer is nuanced) Matthew and Jay explain the "2-of-3" setup of DLCs and what term is more accurate.
Why Centralized Lenders Failed: Jay gives an insider's perspective on the CeFi blowups (Celsius, BlockFi). It wasn't just malfeasance; it was a structural flaw. Lygos flips this model: your collateral stays on-chain, locked in a DLC, and is never rehypothecated.
The Capital Markets Thesis: Why is DeFi liquidity sometimes cheaper than institutional capital? We discuss the strange inversion of interest rates and how Lygos plans to bridge the gap, eventually allowing smaller regional banks to lend against Bitcoin without ever touching the asset itself.
Why BlockFi Failed & How DLCs Fix Bitcoin Lending with Lygos Finance
Remember: You’re getting this before anyone else. Don’t share the link with your friends.
Though you should grab your referral link below. That will mean something soon.