Foundations of Fiat-Denominated Loans Collateralized by Cryptocurrencies
Pavel Hub\'a\v{c}ek, Jan V\'aclavek, Michelle Yeo
TL;DR
This paper explores secure, limited-custodial protocols for fiat-denominated loans backed by cryptocurrencies, analyzing their game-theoretical properties and suggesting future research directions.
Contribution
It introduces the first limited-custodial protocols for crypto-backed fiat loans with trusted arbitration and analyzes their game-theoretic aspects.
Findings
Protocols rely only on trusted arbitration
Game-theoretical analysis of protocol security
Highlights future research directions
Abstract
The rising importance of cryptocurrencies as financial assets pushed their applicability from an object of speculation closer to standard financial instruments such as loans. In this work, we initiate the study of secure protocols that enable fiat-denominated loans collateralized by cryptocurrencies such as Bitcoin. We provide limited-custodial protocols for such loans relying only on trusted arbitration and provide their game-theoretical analysis. We also highlight various interesting directions for future research.
Peer Reviews
No public reviews on file for this paper yet. If you reviewed it on a platform where reviews are public (OpenReview, ICLR, NeurIPS, ICML), you can paste yours below so the community can read it here.
Videos
No videos yet. Explain this paper in a talk, walkthrough, or lecture? Add one.