Introducing Templar:
The First Cypher Lending
Protocol

Bitcoin, the rebel cryptocurrency born from the 2008 financial crisis, is now being stockpiled by the very institutions it aimed to supplant. In 2024, traditional finance finally embraced Bitcoin with open arms and deep vaults. Exchange-Traded Funds (ETFs) holding Bitcoin attracted $63.5 Billion in investment in a single year, making Bitcoin the second-largest commodity ETF market after gold​. The catch? Almost all those coins ended up with a few corporate custodians. Coinbase, the largest U.S. crypto exchange, now serves as custodian for over 90% of the Bitcoin held by the U.S. ETFs​ and unilaterally controls around 2.3 million Bitcoin (>10% of the total supply)​. It has become the world’s biggest Bitcoin holder: essentially a modern vault holding everyone’s keys​.

This institutionalization of Bitcoin has a dark side. A currency built on decentralization is becoming concentrated under corporate guardianship. From BlackRock to ARK Invest, nearly every major fund is entrusting their Bitcoin to Coinbase. Factor in Corporate treasuries, MicroStrategy, mining firms, and an increasing number of nation states, and an immense share of Bitcoin now lives behind a few guarded walls. Now President Trump has opened the floodgates for banks as well. It’s not just ETF-holding institutions coming for your Bitcoin, it’s Banks: the very leviathan Bitcoin was created to oppose.

This raises an alarming question: if a handful of companies and institutions hold the keys to the kingdom, what happens to Bitcoin’s promise of decentralization and censorship resistance? In the event of a contentious hard fork, BlackRock et al. choose the winner, keep one fork, sell the other, and control the future of Bitcoin. 

This creeping centralization of custody cuts against the ethos of cryptocurrency. Satoshi Nakamoto warned that “the root problem with conventional currency is all the trust that’s required to make it work​.” Yet here we are, trusting middlemen to hold our Bitcoin. Handing over your coins to an exchange or bank means surrendering the sovereignty that Bitcoin gave you. The mantra “trusted third parties are security holes” exists for a reason.

Today, many users still trade convenience for security by parking their Bitcoin with centralized lenders and exchanges. Need a loan against your Bitcoin? DeFi doesn’t provide a proper solution for Bitcoin lending: wrapped Bitcoin is centrally custodied by Bitgo or Coinbase. A CeFi platform will also oblige, but only if you give up custody of your Bitcoin. This reliance on centralized institutions contradicts everything the cypherpunks champion. Bitcoin was meant to cut out trusted third parties (TTPs), not create new ones. And we’ve suffered the consequences: from exchange hacks to the implosions of FTX, Celsius, and BlockFi, entrusting your coins to TTPs often ends badly. Even if a custodian doesn’t fail, you’re always one step away from being locked out of your wealth: by a withdrawal freeze, a government order, like Executive Order 6102 which seized all Gold held by US citizens, or an accident. In short, centralized custody and lending undermines the very freedom Bitcoin was designed to deliver.

Watching centralized giants dominate the narrative is a call to action. It doesn’t have to be this way. We envision a future where Bitcoin users are not reliant on centralized financial services.

Cypher lending is that alternative. In this model, the Multi-Party Computation (MPC) network replaces the Trusted Third Party (TTP) as Nick Szabo suggested.

The cypherpunk philosophy is simple: privacy, decentralization, and self-sovereignty. Applied to lending, that means a decentralized MPC network and open-source smart contracts ensuring that you get your collateral back after repaying the loan. Imagine leveraging your Bitcoin as collateral without handing it to any bank or exchange, then borrowing dollars against it—no gatekeepers required. There’s no trade-off between security and utility; you will have both.

The breakthrough insight behind Templar is simple: you shouldn’t have to trust any third parties to access dollars. We are faced with the reality that while Bitcoin has established itself as a store of value, it has not been widely adopted as a medium of exchange. The world still prefers alternatives (like stablecoins) that have low short-term volatility in exchange for diminishing purchasing power in the long run. Getting dollars from your BTC should not mean trusting a centralized custodian or selling, which incurs taxes. For too long, people assumed that to get a loan, you must trade your freedom. Today, smart contracts and MPC networks prove that assumption false.

In practical terms: you send Bitcoin to an address secured by an MPC network, and stablecoins are deposited to your account. This flips the old model on its head. No more sending your Bitcoin to a third party just to get a loan. Cypherpunk ideals and practical finance can coexist, and Templar is built on the premise that they must.

Templar is enabling borrowing and lending that are private, permissionless, and aligned with the Cypherpunk ethos. It’s time to reject the false choice between liquidity and liberty.

Meet Templar, the first Cypher Lending Protocol — a decentralized lending platform. With Templar, you can borrow U.S. dollars (via stablecoins) against your Bitcoin or other assets without any Trusted Third Parties. There’s no central party holding your collateral; instead, an MPC network and smart contracts ensure your Bitcoin will never be frozen or seized.

What makes Templar different? It’s cypherpunk to the core—NOT institutional. Key features include:

• Permissionless: No accounts, no credit checks, no invasive KYC. Anyone, anywhere can use Templar directly from their wallet. Borrowing, lending, and deployment of markets and vaults, will be permissionless. 

• Open Source & Unstoppable: The rules are enforced by open-source code—no backdoors or “trust us” admins as contracts are non-upgradable. Running on decentralized rails means it can’t be easily shut down.

• Private: Templar does not require users to connect a wallet and does not collect any information from them. The ability to interact by just sending and receiving, rather than requiring an onchain wallet to connect, also improves the UX for users who aren’t onchain native. Templar will implement markets that support Differential Privacy based on the work by Tarun Chitra et. al. to prevent predatory liquidations, privacy pools which only accept specific denominations of assets and utilize ZK proofs to protect users’ onchain privacy, and more.    

In summary, Templar enables finance the way it should be: get access to a medium of exchange backed by a store of value. It fuses cutting-edge MPC networks with cypherpunk ideals. Borrow against your Bitcoin without surrendering custody to a Bank or Exchange. With Templar, you leverage your assets on your terms with no one standing in the way.

Templar isn’t just a product, it’s a movement. Our vision: a world where you can be your own Bank. In the past, Swiss accounts were the elite’s escape; in the future, Templar will enable everyone to enjoy that level of privacy and self sovereignty in their pocket. 

"It's like a swiss bank account in everybody's pocket" - Obama on Bitcoin "It's like a swiss bank account in everybody's pocket" - Obama on Bitcoin

This is the Cypherpunk endgame. The Decentralized Network of Sovereign Individuals will triumph over the State & Banking Leviathans and remove their ability to freeze or seize your wealth—Bitcoin’s promise, fulfilled. If you’re a cypherpunk at heart, or just sick of being told to “trust us”, Templar is built for you. Now is the time to be your own (Swiss) bank. 

Join the discussion and follow Templar for updates. 

The era of Cypher Lending has begun.