A conversation with Michael Svoboda & Cyrille Brierè
“If Ethereum is a trustless infrastructure, then its money should be trustless too”
Michael leads the company behind Liquity, an Ethereum-native borrowing protocol that allows users to take loans against ETH and mint the protocol’s own stablecoin, BOLD.
Liquity has been live for nearly five years, operating fully on Ethereum and offering overcollateralized loans with peer-to-peer yield mechanics. The protocol now runs two versions and continues to focus on Ethereum-aligned, fully on-chain financial primitives.
Cyrille is a contributor to Aladdin DAO, the DAO behind F(x) Protocol, an evolved CDP (Collateralized Debt Position) system.
Cyrille works on protocol design, ecosystem strategy, and adoption initiatives aimed at reducing reliance on centralized stablecoin infrastructure. He is also a co-initiator of The Trustless Force, a grassroots movement advocating for sovereign, on-chain financial primitives aligned with Ethereum’s core values.
In this episode of AthenaX Livestream, we sit down with Michael from Liquity and Cyrille from Aladdin DAO, core contributors behind two Ethereum-native stablecoin protocols—Liquity and F(x) Protocol.
Together, they are spearheading a new grassroots initiative called The Trustless Force—a movement aimed at bringing awareness, adoption, and community coordination around sovereign, crypto-backed stablecoins on Ethereum.
This conversation dives deep into stablecoin risk, yield mechanics, peg defense, regulatory shifts, and why 2026 might quietly become the year of sovereign dollars on-chain.
Michael reframed the question immediately: stablecoins themselves are not the problem—they are crypto’s killer use case. The real issue is understanding that not all stablecoins carry the same trust assumptions. He explained that many stablecoins operate in a gray zone, combining centralized custody, opaque collateral strategies, and regulatory exposure without offering the clarity of either full regulation or full decentralization.
Cyrille added that the larger concern is user awareness. Most users do not actively assess the risks behind the stablecoin they hold. They rarely question freeze risk, redemption limitations, counterparty exposure, or custodial concentration. For him, the problem is not centralization—it is ignorance of the underlying risk model.
Michael described Liquity’s design as peer-to-peer finance. Borrowers set their own interest rates, and stablecoin holders receive that yield directly. There is no treasury allocation strategy, no off-chain carry trade, and no centralized asset management layer. Yield flows transparently from borrowers to holders.
Cyrille explained that F(x) Protocol also focuses on organic, on-chain yield generation. Over the past year, millions in yield were distributed directly from protocol mechanics rather than external real-world asset exposure. He emphasized that transparency is built into the system—no third-party attestations are required because everything is verifiable on-chain.
Both guests agreed that while these yields may not always outcompete centralized treasury-backed yields, they offer a clearer risk-adjusted profile because the source of return is explicit and transparent.
Michael outlined Liquity’s peg defense mechanism, which relies on borrower incentives, redemption mechanics, and market forces. When the stablecoin trades below peg, holders can redeem it for underlying ETH collateral, creating direct arbitrage pressure. When it trades above peg, borrower rate adjustments rebalance the system.
He stressed that overcollateralization—typically 150% to 200%—ensures that each unit of stablecoin is fully backed by visible on-chain collateral.
Cyrille explained that F(x) uses a more dynamic peg-keeping system, incorporating progressive liquidation and efficient collateral structures to maintain tight peg stability. While the design differs, the principle is the same: eliminate reliance on centralized intervention and let transparent mechanisms enforce stability.
Cyrille acknowledged that crypto-backed stablecoins are inherently less capital efficient than fully fiat-backed alternatives. However, he argued that they do not need to replace the entire stablecoin market. They only need to scale sufficiently to meet demand for sovereign alternatives.
Michael expanded this into what he called the “5% thesis.” If just 5% of the global stablecoin supply migrated to trustless models, billions in collateral would move directly onto Ethereum. That would increase demand for ETH and other crypto assets while strengthening the economic base of the ecosystem.
For both guests, the goal is not dominance—it is resilience and optionality.
Michael predicted a bifurcation. On one side, highly regulated tokenized assets—stocks, RWAs, treasuries—operating under strict compliance frameworks. On the other side, fully trustless infrastructure that remains independent of jurisdictional control. The gray middle will become harder to sustain as regulation tightens.
Cyrille added that sovereign stablecoins may become most valuable when centralized systems fail to meet expectations. He suggested that geopolitical shifts and regulatory weaponization of financial tools could increase demand for censorship-resistant money.
Rather than competing directly with regulated assets, sovereign stablecoins will coexist as an alternative for users who prioritize autonomy and neutrality.
Michael explained that The Trustless Force is a grassroots coordination effort. Many builders who care deeply about decentralization are scattered across the ecosystem. The initiative aims to bring them together, raise awareness, and drive adoption of trust-minimized protocols.
The first symbolic mission is shifting 5% of stablecoin liquidity toward trustless models. Beyond that, the broader goal is cultural—honoring aligned builders, encouraging communities to allocate treasury exposure thoughtfully, and reinforcing Ethereum’s founding principles.
Cyrille emphasized that contribution can take many forms: shifting stablecoins, amplifying education, building aligned tools, or simply promoting the movement’s message. The objective is not tribalism—it is coordination around shared values.
Stablecoins are no longer just about convenience—they are about control.
Michael and Cyrille do not argue for eliminating centralized stablecoins. Instead, they argue for awareness, diversification, and preserving sovereign alternatives.
As 2026 unfolds with tokenized equities, regulated appchains, and expanding institutional rails, the ecosystem may split into two clear directions: compliant finance and censorship-resistant finance.
The Trustless Force is betting that Ethereum’s original values—transparency, neutrality, and trust minimization—will still matter.