Wrapless: The trustless lending protocol on top of Bitcoin

• URL: http://arxiv.org/abs/2507.06064v3
• Date: Thu, 07 Aug 2025 13:32:08 GMT
• Title: Wrapless: The trustless lending protocol on top of Bitcoin
• Authors: Oleksandr Kurbatov, Kyrylo Baibula, Yaroslava Chopa, Sergey Kozlov, Oleh Komendant, Illia Dovhopolyi, Dmitrii Kurbatov, Zakhar Naumets, Yuliia Aritkulova, Pavel Kravchenko, Volodymyr Dubinin, Lasha Antadze, Yaroslav Panasenko, Mykhailo Velykodnyi,
• Abstract summary: Wrapless is a lending protocol that enables the collateralization of bitcoins without requiring a trusted wrapping mechanism.<n>The protocol facilitates a "loan channel" on the Bitcoin blockchain, allowing bitcoins to be locked as collateral for loans issued on any blockchain that supports Turing-complete smart contracts.
• Score: 10.898138943807599
• License: http://creativecommons.org/licenses/by/4.0/
• Abstract: This paper presents Wrapless -- a lending protocol that enables the collateralization of bitcoins without requiring a trusted wrapping mechanism. The protocol facilitates a "loan channel" on the Bitcoin blockchain, allowing bitcoins to be locked as collateral for loans issued on any blockchain that supports Turing-complete smart contracts. The protocol is designed in a way that makes it economically irrational for each involved party to manipulate the loan rules. There is still a significant research area to bring the protocol closer to traditional AMM financial instruments.

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