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> and given how easy crypto is to steal and never return, I wouldn't WANT to lend it to anyone anyway! That's why all this "lending" is a joke anyway. They len
by Slartie 5y ago
> and given how easy crypto is to steal and never return, I wouldn't WANT to lend it to anyone anyway!
That's why all this "lending" is a joke anyway. They lend you less than your collateral. If you want to "borrow" 1 BTC, for example, you need to first have the value of x BTC (with x being something larger than 1) in the form of some other crypto as a collateral and lock that up somehow.
So if I want to borrow 1000$, I first need to provide 1000€ and then hope the $/€ rate doesn't come too close to 1:1, because at that point my borrowing position is liquidated and I end up having paid interest for borrowing money I already had in the first place.
If that sounds ridiculous, that's because it is. Lending needs trust and is thus inherently incompatible with trustless cryptocurrencies.
- tim333 5y agoIt's more like borrowing a few k against your house to buy stuff. It has its uses.
- Slartie 5y agoIts only "use" is to artificially inflate the total crypto market cap by effectively providing another source of leverage to crypto coin traders. And no, it is not at all like borrowing against your house. You can live in a house, even if you secure a loan with it. If living in your house is your primary use case for your house, which is the case for a lot of people, that's totally fine. You cannot "live" inside of your BTC. They are a token of value that is effectively useless to you if you cannot do the only thing that you can possibly do with a token of value: spend it for something else you desire to have.