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This seems to be the trick. I think this same thing also explains the high market cap of many altcoins, such as Solana. Instead of selling and crashing the pric
by Geee 4y ago
This seems to be the trick. I think this same thing also explains the high market cap of many altcoins, such as Solana. Instead of selling and crashing the price, these are held onto and used as a collateral to borrow against.
- oldgradstudent 4y agoThe two sentences > Instead of selling and crashing the price and > these are held onto and used as a collateral to borrow against. Are not compatible. If selling the assert crashes its price, it is a terrible collateral. I would like to see how lenders justified in writing accepting large quantities of FTT as collateral.
- rvba 4y agoMy understanding that it is an extension of the old joke about someone wanting to sell a dog for 1 million that was finally traded for 2 cats worth half a million each. Basically extended comment of michaelbuckbee. You have your $mikecoins "worth" 1 million and someone else makes $annacoins worth 1 million and some other party makes $bobcoins worth 1 million - and you each "lend" them to each other to make a complicated net. Then Mike, Anna and Bob just wait for some people to invest real money - and cash out. People who bought those $mikecoins, $annacoins and $bobcoins think that they can "always sell them back at the market", but the market didnt really exist. From those 1 million coins minted, maybe 250 thousand were sold, rest are held by creators to sell them to bagholders.
- disqard 4y agoYour explanation is the clearest one I've read thus far, of how these token scams work.