How To Hide Your Money Under A Virtual Mattress And Earn A Return In The Process

Instead of storing cash under the mattress, Bitcoin users can transfer their funds into stablecoins and lend them out for a high interest rate.

Occasionally, you’ll read a news item about an eccentric individual who accumulated a substantial quantity of money and stashed it all away under a mattress. We shake our heads and wonder why someone would do such a thing. Doesn’t he understand the risks involved? A fire could burn it all or a thief could steal the entire stash! He could lose his life savings in a single tragic event.

Not only that, think of all the missed opportunities to invest the money and build wealth. The money could have earned interest in the bank or been invested in a mutual fund. Stashed under a mattress, money loses its value as inflation erodes the purchasing power over time.

Why would anyone store money under a mattress? Rational people don’t do that — or do they? There are two good reasons for keeping money under a mattress. One, you don’t trust banks, investment advisors or brokers with your money. You trust self-custody of your assets under a mattress more than you trust third-party custodians. Two, you want immediate access to your money. You can’t wait for weeks if your money is tied up due to a political protest or a war; you don’t want to wait three days for a transfer; or you may need your money after-hours or on weekends. Under your mattress, your money is readily available anytime you need it.

If you’ve been paying attention to the news, both of the above reasons are rapidly becoming more compelling. If your government doesn’t like the recipients of your charitable giving or disagrees with your tweet criticizing a government policy or action, they can compel your bank or broker to freeze your account or seize your funds.

If you live in a nominally democratic country, this may have seemed like a far-fetched scenario even a year ago. But we now know that this is a very real threat to people who value their freedom. In some cases funds have been seized; the custodian failed to take custody. In other cases, funds have been frozen; immediate access was denied.

As crazy as it sounded at the start of this piece, money under the mattress is beginning to sound more and more appealing to rational people. But the risks and lost opportunities of mattress custody persist. What if an alternative exists? A way to self-custody but without the risk or lost opportunity. This is where bitcoin and technology shine. Bitcoin allows you to store value in a virtual mattress, accessed digitally and with self-custody, but with relatively low risk of fire, theft or other tragic loss. Not only that, you don’t have to give up the opportunity to invest your funds.

Bitcoin is the original, most proven, most secure and most widely valued cryptocurrency. Storing value in bitcoin allows you to self-custody by storing a small amount of information, called a private key, that allows you (and only you) to send your bitcoin. Bitcoin is becoming an important investment asset.

Buy Bitcoin And Take Custody

The first step in solving the virtual mattress problem is to buy bitcoin. In fact, you could simply purchase bitcoin and solve the virtual mattress problem without doing anything else. Details about how to buy bitcoin are given at the end of the article.

The value of bitcoin has a track record of phenomenal long-term gains as an investment. Unfortunately, the market value of bitcoin is extremely volatile. You may need your money without having to wait to ride out the bitcoin value roller-coaster. Or you may simply not have the stomach for financial roller-coasters.

Convert Your Bitcoin To A Stablecoin

This is where an interesting option comes into play. The world around Bitcoin has developed a class of coins called stablecoins. Stablecoins are designed to track the value of a standard currency very closely but can be moved around digitally. The most common stablecoins track the dollar. Tether, USDC and DAI are among the most widely used dollar stablecoins. Holding these coins is similar to holding dollars. Once you have bitcoin, it is straightforward to swap your bitcoin and receive the same value in dollar-backed stablecoins. So the next step is to buy stablecoins with your bitcoin.

Buying stablecoins with your bitcoin presents some choices. The payoff is a much safer virtual mattress that can actually earn you a nice return. The Bitcoin network itself only supports bitcoin. To swap for stablecoins requires that you transfer your assets to a different network or blockchain. The Rootstock (RSK) chain is a great choice because it is built as a layer on the Bitcoin network and allows you to pay transaction fees directly in bitcoin rather than requiring you to purchase a different asset just for fees. And because it is built on the Bitcoin network, RSK has many of the same attractive properties that drew many people to buy bitcoin.

To use RSK, we need an interface, a platform for making actual transactions, such as Sovryn. Sovryn is a protocol that runs on RSK. This platform is essentially a full-stack financial operating system that enables you to do financial transactions with bitcoin. Sovryn is a decentralized finance (DeFi) platform. It is a collection of financial computer programs called smart contracts that allow for permissionless and trust-minimized use of funds that you own, control and self-custody. You don’t need to identify yourself or ask permission. The code simply runs and does what you want with your assets.

To get bitcoin on Sovryn, you first need to configure a Web3 wallet to connect to the Sovryn DApp (web interface). This wallet will keep track of your assets and transactions on RSK. Once you have your wallet configured, you can easily deposit RBTC right from your Sovryn portfolio using FastBTC. FastBTC converts bitcoin (BTC) into RBTC (RSK BTC), which is the equivalent asset that is usable on the RSK network.

Once you have RBTC on Sovryn, you can then convert it to XUSD. XUSD is a dollar-pegged stablecoin on Sovryn that can be transferred 1:1 to Tether, USDC or DAI and can be used to buy back RBTC or buy other assets on Sovryn. Holding XUSD, like other dollar-pegged stablecoins, is essentially the same as holding dollars. To obtain XUSD, simply swap RBTC for XUSD.

Invest Your Stablecoin Stash

With XUSD, you now have the equivalent of dollars hidden under a virtual mattress. The private key to your wallet is the only way to get access to the XUSD that you own. No one else can spend, take or freeze it. These benefits alone are compelling reasons to use a virtual mattress. But this virtual mattress is superior to the ordinary variety in another important way: you can actually invest your stablecoin stash while it is under the mattress!

To invest your XUSD, you can lend your XUSD. Go to the “lend” page and deposit XUSD. At the time of writing, XUSD deposits are paying 5.5% APY. The APY varies over time depending on the supply of XUSD deposits and the demand to borrow XUSD. This rate of return far exceeds anything you can get from your mattress, but also far exceeds what you can get from your bank!

But that’s not all! Currently, Sovryn is paying XUSD lenders a reward for providing funds to borrow. The rewards are paid in SOV, the governance token of the Sovryn ecosystem. Rewards are locked in a vesting contract over a 10-month period, and then 10% is unlocked monthly. At the current price of SOV, this reward equates to roughly 20% APY on top of the regular return! Now that is a lucrative mattress!

What if you need some of your virtual mattress money? You simply reverse the process. Withdraw your XUSD from lending, buy RBTC with it, withdraw RBTC to get bitcoin back on the Bitcoin network and then sell your bitcoin. Then transfer the funds to your bank and withdraw. If returning funds to your bank is not an option for you, other alternatives are available. You can buy debit cards or gift cards online using your bitcoin or sell your bitcoin to someone for cash in person.

This process is obviously not as easy as stuffing bills under your mattress. But it is far safer and far more rewarding and is worth the effort. Links are provided throughout this article to assist you with each step. If you are not familiar with cryptocurrency or have never dealt with wallets and transactions, you might have a local friend who can walk you through the process. As always with any investment, do your own research. Holding and transacting cryptocurrency has its own set of risks that you should research and understand before investing.

If you have friends who are not familiar with the cryptocurrency but may be considering the mattress option (or need to), please share this article and offer to walk them through the process.

How To Buy Bitcoin

There are many ways to buy bitcoin. They vary in terms of convenience, cost, volume limits, security and availability by jurisdiction. Let’s look at several options.

In some jurisdictions (primarily Europe and Asia but not the U.S.) you can buy bitcoin directly on the Sovryn platform. Go to the portfolio page on the DApp and select “Buy for RBTC.” You are currently limited to approximately 12,000 Euros.

If you’re in the US, the most convenient and inexpensive way to buy bitcoin is through Strike. Strike uses the Lightning Network to move money, both bitcoin and dollars. It works similarly to Venmo. Download the Strike app on your phone, set up an account and connect to your bank. You can immediately deposit money into your Strike account and use it to buy bitcoin. Strike allows you to buy bitcoin with no fees! To custody the bitcoin, you must send it to a wallet you’ve set up.

You can set up a wallet using the Electrum wallet on your computer and then send the bitcoin using a QR code generated by the Electrum wallet. By default, Strike has very small limits on deposits, sending cash and buying and selling bitcoin. You can request an increase of the limits, and you’ll be asked to provide more information to have the request granted. After the limits are raised, you will be limited to $1,000 in deposits per week. If you’re not in the U.S. or you want to buy a large sum of bitcoin, you may want to consider a different option.

Coinbase is a well-established, user-friendly exchange. You can link your bank account and transfer funds directly. Coinbase charges transaction fees. Once you’ve purchased bitcoin on the exchange, you can use FastBTC to transfer it off the exchange into RSK to use on Sovryn.

Ascendex,, and KuCoin are three other exchange options to consider. Ascendex has several options for paying with cash through a bank. allows purchases with a credit card. Kucoin allows bank transfers, credit cards, Apple Pay and other methods. These options will vary by jurisdiction.

If you don’t want to involve an exchange at all, you can make direct peer-to-peer purchases using Bisq or LocalBitcoins. Here’s a link on the best ways to get bitcoin without having to disclose personal information:


Nothing on this page should be taken as investment advice. Inclusion of a third-party app or service does not constitute an endorsement of the app or service by Sovryn developers or anyone else in the Sovryn community, and is provided for informational purposes only. If you have any problems with the listed third-party apps or services, please contact the maintainer of that app or service for help. Sovryn does not have any control of your funds in any supported Web3 wallet. You are responsible for your own wallet security. Please do your own research and ensure you understand and accept the risks before trading or using any apps or services to store your funds.

This is a guest post by Stan Reeves. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc. or Bitcoin Magazine.