Bitcoin holders can now employ a similar strategy by short-selling the US dollar and holding onto the harder asset, BTC, said Mauricio di Bartolomeo.
Before discovering Bitcoin
BTC
€94,217
, the co-founder of Ledn, Mauricio di Bartolomeo, found success short-selling the Venezuelan bolívar as it rapidly lost value against the stronger US dollar. Now, with the US dollar depreciating against Bitcoin, borrowing against Bitcoin instead of selling it has become a more viable strategy.
“Before Bitcoin, my most successful investment was short-selling the bolívar with dollars,” di Bartolomeo told Cointelegraph in an exclusive interview at the Consensus conference in Toronto, Canada.
“I was borrowing bolívares and buying dollars with them, holding the strong dollars and having a debt position in the weaker currency,” he explained.
The arrival of Bitcoin-backed loans means that investors can now effectively implement the same strategy using a stronger currency as collateral.
This was part of the motivation behind the launch of Ledn, a Cayman Islands-based company that allows Bitcoin holders to access liquidity in dollars without having to sell their BTC.
By borrowing against Bitcoin, “you’re basically doing the same thing, but you’re effectively holding the strong money, which is Bitcoin, and taking a debt position in dollars, which is a weaker currency,” di Bartolomeo said, adding:
“This creates a virtuous cycle that we see happening over and over again with real estate, with loans against your stocks, loans against your gold, and Bitcoin is no different.”
