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13 sats \ 2 replies \ @lendasat OP 10 Jul \ parent \ on: Building Lendasat on ARK - Introducing DLC VTXOs bitcoin
You do not receive a synthetic dollar.
Your Lightning invoice is paid instantly with Bitcoin, and you pay back later with Bitcoin, but in dollar terms.
Understood. Then what would be the base denomination representation of the DLC dollar?
An inverse derivative locked contract like stablesats and what kollider built before is what I thought would be the base representation. Which means it would be a synthetic dollar.
Do you have any documentation explaining this portion of the contract and how you are attributing the derivative to make dollar representation?
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With a stablesats you would go short on Bitcoin, thus you will stay stable in dollar terms but not in bitcoin terms, meaning that you could end up with less btc if the market price appreciates.
With lendasats it's the other way around. You would basically go into an over collateralized long position with the lender, who would in turn go short. Thus the borrower takes the Bitcoin exposure while the lender takes the dollar exposure.
Do you have any documentation explaining this portion of the contract and how you are attributing the derivative to make dollar representation?
Not yet, but we will work on it.
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