When you make homemade soap using the hot method or the cold method, you will be handling soapmaking lye. Soapmaking lye, also known as caustic soda and sodium hydroxide, can be a very dangerous chemical. It can cause blindness and severe burns when it comes in contact with your eyes or skin and could be fatal if swallowed. When working with soapmaking lye, it is necessary to be very cautious in order to prevent any kind of injury.