RecapRecap
A year has come and go and the market did not go in my favor. When I opened this loan in July of 2025 the Bitcoin price was about $118k. I had dreams of the price going up and I would be able to execute the Buy, Borrow, Die, Strategy. If the Bitcoin price was at $250k today, I would be able to sell a few sats to pay off the outstanding loan balance and would have killed two birds with Bitcoin. Buying Bitcoin and using leverage on it to pay off debt while using the price appreciation to come out ahead with a bigger Sat stack.
But markets had other plans. June is almost over and the Bitcoin price is sitting firmly at $60k. With the price being alomst 50% what it was last July using Buy, Borrow, Die doesn’t work. The Strike loan minimum was way more than I needed. Meaning I knew I would need to make payments to avoid getting liquidated and having a large loan balance that I would need a lot of fiat to pay off come July 2026. While Darthcoin tries to dance on my grave and call me a fiat maxi for using a bitcoin backed loan to pay off fiat denominated debt and praying I would get liquidated, the probability of that happening was very low. I never over extended myself and plus I used a large tax return to seed this Buy, Borrow, Die strategy. I never used my main stash and instead of just paying off the debt I wanted to use this product just to have the experience and write about it on Stacker News.
What’s NextWhat’s Next
About 2 or 3 months ago Strike sends me an email saying they are no longer supporting bitcoin backed loans in my state! This killed the idea of rolling over my loan balance ($13K) into a new loan which has a minimum much more than I needed. Since Strike pulled out of my state I started to look for alternatives if I wanted to continue with the Buy, Borrow, Die, Strategy.
Experience with LygosExperience with Lygos
So I tried a loan with Lygos finance due to my connection to the Atomic Finance team. Tony and Matt Black sold thier company and the DLC tech they were working on for years to Lygos. Lygos reached out looking for testers and after confirming with Tony on discord that they were legit I decided to give them a shot.
I opened a small test loan with them for $1k. To open a loan I had to contact the app developer and over email I had to workout the detials of my loan. Once that is done he gives me a code to access the loan in the app. I downloaded the Lygos app and found my loan. I deposited my bitcoin (50% LTV) and got USDC stables back which I used quite easily in Robinhood. The app uses email and password and is a full bitcoin wallet with seed words. Below are some pics of a test $10 loan I did to make sure everything is working fine:
After I opened the loan I noticed the pay back flow was very clunky. I want to give Lygos some grace because I know they are still in development but I would pay back USDC and the balance in the wallet wouldn’t update. Plus the app charged all the interest I would owe over the life of the loan upfront. I had to email back and forth with the app developer to record payments and make sure everything was up to date.
While it was cool to see everything on chain the payback flow was not intuitive. The team needs to improve that aspect before they can have a real chance of challenging Strike. A few months later I emailed the Lygos app developer to open a new loan to close my Strike one. Like last time getting a loan isn’t on demand. I was waiting for weeks for them to source credit and once they did the terms were confusing. They are only offering 90 day interest only loans. Meaning I can’t pay off the loan early. I would have to wait to the end of each of the 90 day period to pay it off. But I could have unlimited rollovers. Which is convenient not not what I am looking for. So I decided that Lygos was not the app to continue this Buy, Borrow, Die, Strategy.
Surge CreditSurge Credit
I learned about Surge Credit randomly on YouTube. The algorithm showed me their video and I was quite impressed. They issue a credit line backed by bitcoin using taproot as your bitcoin vault that the user can verify on chain and pays out USDC on Base. After watching the video I downloaded it and tried a test loan:
I must say the app is very easy to use. Plus the app gives you options on your interest rate. You can roll the dice with the “DeFi” and get a slightly better rate or you can select the standard 9.99% APR if you want to limit your risk.
They also publish a dashboard that shows the total credit and stablecoin liquidity currently within the application.
Testing the application over the last month or so it seems to be pretty stable. Once I did have an issue I emailed tech support and they fixed it rather quickly. They also had a major bug that impacted logins but the funds were safe. After about a week or two they released a new version of the app in testflight which I had to use my recovery seed ( which the app does a good job forcing the user to write down) to regain access to my account and funds. The level of support gives me confidence that a bug won’t rug pull me. (Hopefully)
So after weeks of wondering what I should do next I finally made up my mind. I was going back and forth on if I should just sell some corn on Strike close the loan and just be humble. `But it sucks to sell BTC at low price in this bear market.` I know this falls into the sunk cost fallacy but I am Bitcoin hyper bull and I want to see if this Buy Borrow Die Strategy can truly work. Plus according to this app that was shared on SN if I want to maximize my corn holdings I should roll over and continue to pay down the balance with the earnings I get from my fiat mining future earnings.
So the plan is simple. I am going to use some fiat and pay off the Strike loan. Then I will take that BTC and put into Surge Credit. Draw the USDC on Base send it to Robinhood and go all in on STRC!! (jk about the STRC). This will be my roll over as I continue to pay down the balance over the next year. The Surge Crdit app is going to charge me about $3.50 a day in interest which I can pay off anytime I want.
Let’s hope in July 2027 I won’t regret this. And don’t worry Darth I WILL NEVER BE LIQUIDATED!!
What made you think right around an ATH that the probability of NgD was very low? Who influenced you that way?
Find that root cause, and you can defend against it in the future.
NgD is always in my mind. That’s why I pay on my debts!
Why I’m never liquidated.
I was hoping NgU would would work in my favor last July
So!
Time to roll the dice again!
If Bitcoin goes to zero or $1M I will be fine either way. So why not have fun!
Look... you wanna casino, you gonna casino, I don't care what you do with your money.
What is interesting though is what the lesson learned is, so that others can avoid making the same mistake.
Why I made the post!
Right! So what made you think at 118K that the probability of NgD was small? Because that is about as far away from what was realized as possible.
So what I'm saying is that there was a (massive) gap between expectation and reality. What caused that? Was it the euphoria on social media or podcasts? Was it something someone in particular said in their TA? What caused the discrepancy?
I never thought it was small.
I had realistic expectations that it can and will go down. That is why I prepaid the loan.
I did this Strike loan to try out a common the fiat strategy of borrowing against your assets.
I did this because I wanted to to have more corn and pay off debts that I have.
If it was a pure NgU play I never would have paid down the loan!
I think I get it now. You thought that the probability of getting liquidated was low because you'd just pay in, but you simply had no care for the outcome, despite dreams of the price going up.
Key word: Dreams
I see you.
Obviously what you should do, silly B, is to deposit all your bitcoin with Surge at 9.99% and plunge the loan proceeds nto STRC at current 13.5% effective yield, and ride the fiat dividends into the sunset.
Pancake.
Hahahaha not all maybe 10% gotta have proper risk management
You don't believe in our lord and saviour Saylor??
Contrary to the belief UTXOS >>>>> STRC.
I can’t send you STRC. But I can send you a UTXO 24/7!
I am no fool
what?! But why would you wanna send it? Don't understand. Just hodl — or ride the lightning with stretch
People gift equities all the time.
Not as often as they gift (well, "gift") money, I presume
Thus UTXO > STRC
One of many reasons why.
Kudos to you for having the mental headspace and financial capacity to pursue this and just roll with the punches!
Really informative, thanks for the post, I’m thinking about taking a btc backed loan against my stack and wanted to post and here and ask stackers for some input about the process and experiences they’ve had as well as whether it’s a good idea to to take out a loan right not with Bitcoo ~50% off all time high.
I’m sorry it didn’t work out as planned for you but experiencing the same as you is what’s keeping me from pulling the trigger .
Indeed Bitcoin can drop 50% from here and you can lose all that you stacked up.
Maybe with Surge and the over next year Bitcoin is up 200% and I get to reap the rewards.
I really appreciate this breakdown! It's helpful to hear about your experience (even though it didn't go as well as you hoped). I'll be interested to learn how the next chapter unfolds.
Ah! The dreams of living off the appreciation of one's corn! I dreamed that dream once. But unlike you (so far), I got in over my skis and liquidated. Bitcoin teaches us Proof of Work one way and the other :) Anyway I hope it all goes well for you and you can either make it through to the next bull or close your positions without you or your family suffering materially for it.
Are there any advantages to this strategy, over just having IBIT in a brokerage acount with margin against it? Other than the big one of realizing a gain on old btc to get it into the etf. You give up custody either way right? In kind redemption on an ETF seems like it would be handy in this scenario, though I dont know if thats possible with any yet.
What does an IBIT margin cost?
Not sure maybe 5%. Brokerage margin is pretty cheap
IBIT is a black box nothing is published on chain. It’s all trust me bro tradfi.
The idea is use bitcoin companies and products that actually use the tech in an innovative way so they can stay around and hopefully compete with the IBITs of the world.
How is this the sunk cost fallacy?
Because price isn't 118k. He's already suffered the loss.
Bitcoins value is 60k (we'll, maybe $0), not 118
yeah but sunk cost fallacy is making a decision out of some obligation you feel because you've already spent money right? Losing money and still thinking you're making a good long-run decision isn't sunk cost fallacy.
Yes it is because I don’t know the future. Me holding on is refusing to realize the loss. If I sold and didn’t get a new loan then you are correct.
I bought Bitcoin at $118k by not selling a single sat to pay off the loan balance I haven’t realized the loss yet.
Yeah but nobody knows the future. That means anyone holding through a drawdown is committing the sunk cost fallacy?
With the price in the toilet after one year I am still hoping the price can increase above $118K which would make this strategy work. Since it is down 50% I am sticking with it even after the losses I experience instead of just paying off the loan and not opening a new line of credit.
Wouldn't sunk cost fallacy be if you stuck with it because of the losses/spent money. As of now you just think it's still a smart strategy despite losses.
Pointless sidetrack I know haha
Yes
I hate that they use USDC. Here in Canada Ledn just deposits the fiat in your bank account. That works fine for me.
No STRC...?
Yes I own STRC in my retirement account. I posted about that the other day.
Gay...
That’s on the roadmap.
@remindme in 6 hours
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