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If you believe that the value of Bitcoin is going to go up, it makes sense to lock is as a collateral and spend the borrowed fiat instead of selling the Bitcoin
by hrhrhrhrhr 5y ago
If you believe that the value of Bitcoin is going to go up, it makes sense to lock is as a collateral and spend the borrowed fiat instead of selling the Bitcoins.
- majormajor 5y agoIs there a part of the system that keeps working even if the value of bitcoin stops (being believed to keep) going up all the time? If ETH or some other new token takes more and more mindshare from btc isn’t that a big inflationary pressure on the crypto ecosystem as a whole? More tokens = less valuable tokens. At some point buy the dip will turn into cash out.
- hrhrhrhrhr 5y agoIf the value of Bitcoin stops going up, sooner or later your debt grows larger than the amount you were allowed to borrow and your collateral gets liquidated by someone who implemented the fastest liquidator bot. https://docs.aave.com/developers/guides/liquidations https://docs.aave.com/developers/guides/liquidations