Our investment to Sovryn - Why Bitcoin needs it.

The natural evolution of bitcoin is a service like Sovryn.

Bitcoin gave us the right and the option to have a currency and asset that is not controlled by the government but by market forces instead. Until now, you could only buy, store and trade bitcoin through centralized entities such as Coinbase and Binance. It’s a matter of time for the governments of the world to form regulations requiring financial institutions like Coinbase to verify the recipient/owner of the self-hosted wallet, collecting identifying information on that party before a withdrawal takes place. This defies the purpose of bitcoin itself. Bitcoin on centralized exchanges will be nothing more than one more surveillance currency.

Many believe that this is inevitable. We believe that it’s not. The journey to a truly independent financial system just needs more imagination and support.

Bitcoin needs decentralized services where people can buy it, trade it or use it as collateral without having to go through the traditional financial system.

The team of Sovryn built the first completely trustless exchange using the bitcoin infrastructure allowing every bitcoin holder to exchange or trade BTC for stablecoins (like Dollar on Chain) without having to go through the traditional surveillance finance infrastructure.

Hence no KYC or AML is needed, in a true bitcoin fashion.

Sovryn introduces several nuances that we have never seen before in any other platform.

First, Sovryn does not have an order book like the traditional spot exchanges. The price of the asset is fed into the system using trust-less oracles. Sovryn utilizes a custom-built version of MoC(link) for that matter, which is a separate subject on its own.

For traders who are looking to use some leverage, Sovryn team has built a trustless lending mechanism that provides funding to traders. Liquidity comes from BTC and MOC holders that can earn interest on their holdings.

All of the above come at a no-custody risk to the users since every smart contract runs on RSK, which is 100% powered by Bitcoin miners and the platform itself has no custody of users’ funds.

Currently, the control of the smart contracts is handled 100% by the team behind Sovryn. This means that changes to the contracts are handled by them but the team has a very public and detailed timeline on how they plan to decentralize the governance of the platform, handing over control to their token holders, which includes investors, users, and the team itself.

We strongly believe that Sovryn, alongside MoC, are fundamental building blocks that the BTC ecosystem needs to thrive and enable true DeFi to be built.