Bitcoin is still early

[Panscan]

worth 40 minutes of your time. (listen at 1.5x)


https://podcasts.apple.com/us/podcas...jSnY-QhMeMDFI0

fine, listening now

[Panscan]

Why do you get paid less interest for a larger amount of capital?

https://blockfi.com/rates

Once you hit 2.5 bitcoin you halve your returns.

[Panscan]

Some of these arguments are pretty bad IMO. Are people really taking out 10 % interest loans to avoid paying capital gains taxes for short term needs? That seems like a really stupid idea IMO. That works if it hits a million from 50k, other situations is probably a really stupid decision versus just selling, harvesting gains and using them while avoiding a high interest loan.

I also don't understand the over-collateralized loans, its like anti-leverage. Why would you put up 100k for 1 bitcoin, which is worth 50k, instead of just buying the coin yourself and having 50k in cash? Some might compare this to a HELOC except the difference is what the collateral is, something that is very non-liquid(a house) vs something that is very liquid( cash). It seems inherently pointless to me. Again, seems like a pointless thing to do unless you're planning on the asset absolutely sky-rocketing while it being the only way you can get money to invest in it.

The stuff about "splitting it with investors" regarding margin calls due to issues with collateral processing in the event of significant volatility: To me that seems like them acknowledging that its very risky and basically they are putting some skin in the game to stop people from jumping ship due to this volatility. No offense but I doubt this guy gives a crap about me or people, he cares about his business staying relevant. It feels like a thinly veiled attempt to act like "they care." In reality, it's them taking on some risk to increase their business, which I highly doubt they would do unless they deemed it necessary to succeed.

Bullish on bitcoin, not on this.

[Lordosis]

worth 40 minutes of your time. (listen at 1.5x)


https://podcasts.apple.com/us/podcas...jSnY-QhMeMDFI0

LOL 40 minutes at 1.5X. If it takes that long to explain it is not only not worth my time but not worth anyone's time. I am going to gladly stay ignorant and sit on the sideline. Time will tell us who was right. I am patient and I can wait. My plan is working already. Good luck.

[jacoavlu]

LOL 40 minutes at 1.5X. If it takes that long to explain it is not only not worth my time but not worth anyone's time. I am going to gladly stay ignorant and sit on the sideline. Time will tell us who was right. I am patient and I can wait. My plan is working already. Good luck.

haha. You ask an explanation of how it works, and here it is right from the horses mouth that you can absorb while exercising, or folding clothes, or pretending to watch cartoons with your kids, or driving to work.

”no thanks.”

I think I’m done here.

[Lordosis]

haha. You ask an explanation of how it works, and here it is right from the horses mouth that you can absorb while exercising, or folding clothes, or pretending to watch cartoons with your kids, or driving to work.

”no thanks.”

I think I’m done here.

I appreciate your effort but I am just not interested. Sorry to waste your time.

I actually watch the cartoons. I have grown fond of peppa pig.

[Panscan]

haha. You ask an explanation of how it works, and here it is right from the horses mouth that you can absorb while exercising, or folding clothes, or pretending to watch cartoons with your kids, or driving to work.

”no thanks.”

I think I’m done here.

I actually listened ! Can’t we have a discussion about it

[jacoavlu]

Why do you get paid less interest for a larger amount of capital?

https://blockfi.com/rates

Once you hit 2.5 bitcoin you halve your returns.

supply and demand. They obviously don’t have enough of a bitcoin supply need to have to offer a higher rate on more deposited coins

better for their business to attract more customers to their platform, than have all their supply needs satisfied by a few whales

analagous to banks with tiered rates on savings accounts

[Panscan]

but this tiering is the opposite. as you deposit more coins you get less interest. You would want to reward people for supplying you with coins

To me that also signifies a potential problem, they have limited demand.

I don't know of any banks that pay less interest as your account gets bigger

[jacoavlu]

Some of these arguments are pretty bad IMO. Are people really taking out 10 % interest loans to avoid paying capital gains taxes for short term needs? That seems like a really stupid idea IMO. That works if it hits a million from 50k, other situations is probably a really stupid decision versus just selling, harvesting gains and using them while avoiding a high interest loan.

I also don't understand the over-collateralized loans, its like anti-leverage. Why would you put up 100k for 1 bitcoin, which is worth 50k, instead of just buying the coin yourself and having 50k in cash? Some might compare this to a HELOC except the difference is what the collateral is, something that is very non-liquid(a house) vs something that is very liquid( cash). It seems inherently pointless to me. Again, seems like a pointless thing to do unless you're planning on the asset absolutely sky-rocketing while it being the only way you can get money to invest in it.

The stuff about "splitting it with investors" regarding margin calls due to issues with collateral processing in the event of significant volatility: To me that seems like them acknowledging that its very risky and basically they are putting some skin in the game to stop people from jumping ship due to this volatility. No offense but I doubt this guy gives a crap about me or people, he cares about his business staying relevant. It feels like a thinly veiled attempt to act like "they care." In reality, it's them taking on some risk to increase their business, which I highly doubt they would do unless they deemed it necessary to succeed.

Bullish on bitcoin, not on this.

I think you should listen again.

You seem to misunderstand. Retail people like you and me aren’t posting cash to borrow BTC. That happens on the institutional side.

don’t be such a hater.

[jacoavlu]

but this tiering is the opposite. as you deposit more coins you get less interest. You would want to reward people for supplying you with coins

To me that also signifies a potential problem, they have limited demand.

I don't know of any banks that pay less interest as your account gets bigger

Lots of banks do this. “Teaser rate”

but how about this. I’ll ask BlockFI your question and report back

you’re missing the forest for the trees.

[Panscan]

it sounds like retail people are posting BTC to borrow cash, and then like you said institutions post cash to borrow BTC. My point is I don't understand why someone would over-collateralize when they can just buy or sell the asset outright to meet their need. I don't know how that would help someone.

I'm not going to invest in something that I think is fundamentally stupid for the counterparty to take place in the transaction. To me that signifies it will not continue as people tend to not work against their own interest for long.

You asked for people to listen, I did and that is my feedback.

[Panscan]

Those are promotions of a short term duration which expire, not fundamental reduction of yield for increased investment, which are permanent.

Also why is bitcoin the only one with that reduced yield for high investments? So I could loan 100 eth and that is reimbursed the same rate as the high school kid with .1, but not for bitcoin.

[jacoavlu]

it sounds like retail people are posting BTC to borrow cash, and then like you said institutions post cash to borrow BTC. My point is I don't understand why someone would over-collateralize when they can just buy or sell the asset outright to meet their need. I don't know how that would help someone.

I'm not going to invest in something that I think is fundamentally stupid for the counterparty to take place in the transaction. To me that signifies it will not continue as people tend to not work against their own interest for long.

You asked for people to listen, I did and that is my feedback.

Retail people may post BTC to earn interest. Then happen upon a short term liquidity need and borrow cash short term

or they want to go long leveraged bitcoin. Borrow cash and buy more bitcoin if they think growth will exceed cost of capital

or someone with bitcoin that wants a loan can’t find traditional financing because banks aren’t interested in their crypto assets.

and retail cash lending is only one arm of income stream.

[Panscan]

Also the fees, it says 0.0025 BTC, is that a flat fee for cost of withdrawal or a ratio? That would be 125 dollars at 50k which is obviously a huge chunk of interest one would earn with a couple coins deposited. Yes I read it says one free withdrawal per month, but if you wanted to make multiple that is a pretty large cost to do so.