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I think you’re missing a key point here, which is that all of these are also available instantly, 24/7. There is no need to negotiate financing with your bank o
by PrestonSeal 5y ago
I think you’re missing a key point here, which is that all of these are also available instantly, 24/7. There is no need to negotiate financing with your bank or otherwise work around a traditional banking schedule.
Further to that point, there are new DeFi products like Alchemix which allow for loans on collateral that cannot be liquidated, so not only do you get your money but you don’t run the risk of ever paying interest or gains tax via a liquidation.
- graeme 5y agoFair, that’s some benefit. Speed and ease do unlock potential. Can you expand on the second point? If something can’t be liquidated/sold, how can it be collateral?
- merdadicapra 5y ago> Can you expand on the second point? If something can’t be liquidated/sold, how can it be collateral? It means that to ask for 1 you need to already own 1 in the form of different cryptos from the one you are loaning. So basically you are asking for money you already have in the first place. With crypto it makes sense: if I loan you 10 bitcoins and you disappear, those bitcoins are lost forever, so to ask for 10 bitcoins you have to put the countervalue of 10 bitcoins in (for example) ETH and freeze them so they act as collateral. If it sounds ridiculous, it's because it is.